26th Parliamentary Intelligence-Security Forum – Cryptocurrency Supervision and Regulation

Mr. Yaya J. Fanusie shared his experience as a former analyst in the US intelligence community, specifically in counterterrorism, and clarified that he began exploring cryptocurrency after leaving the government. Mr. Fanusie then discussed the national security lens through which digital assets and cryptocurrencies are viewed, outlining three dimensions. The first dimension, according to Mr. Fanusie, involves addressing short-term, straightforward risks associated with bad actors using crypto assets. He emphasized the importance of implementing anti-money laundering and countering the financing of terrorism rules, which the US Treasury had introduced in 2013.

The second dimension, described as the “it’s complicated” stage, emerged between 2018 and 2021. During this period, Mr. Fanusie observed increased sophistication among crypto rogues, involving nation-state actors investing in and learning about crypto technology. This phase marked a shift towards geopolitical considerations, with nations like Russia and Iran exploring crypto for reasons beyond immediate financial gains.

The third dimension, referred to as “winning the future,” encompasses the ongoing strategic competition among different actors to shape the future of digital assets. Mr. Fanusie highlighted the current race in innovation, with various forms of digital money emerging and competing within the financial and tech sectors. He concluded by discussing the digital future of finance, contrasting the controlled model pursued by China, particularly with its central bank digital currency (CBDC), against the ethos of decentralization embraced by the cryptocurrency space.