(Bloomberg) -- The US Treasury Department is asking politicians for more enforcement powers to use against foreign providers of crypto services, part of a goal of protecting national security.

“Our problem is that actors are increasingly finding ways to hide their identities and move resources using virtual currency,” Deputy Secretary Adewale O. Adeyemo said in written testimony ahead of a Senate hearing due on Tuesday.

Malign actors such as terrorists always “seek new ways to move their resources in light of the actions we are taking to cut them off from accessing the traditional financial system,” he said.

Over the past year, Iran’s Quds Force — part of the Islamic Revolutionary Guard Corps — sent crypto to militant groups Hamas and the Palestinian Islamic Jihad in Gaza, Adeyemo said. Treasury took action against networks that facilitated smaller donations to Hamas, he added.

North Korea and Russia are among the state actors increasingly using digital assets, Adeyemo said.

Adeyemo is looking for lawmakers to approve a secondary sanctions tool targeted at foreign digital-asset providers that facilitate illicit finance. 

“A new secondary sanctions tool would help Treasury to evolve its targeting capabilities and would account for the technological changes that have rendered highly effective tools in traditional payments contexts less effective against virtual currencies,” he said.

Treasury also wants explicit expansion of its reach to cover key digital-asset players such as crypto exchanges. It’s also asking for authority to go after crypto platforms based overseas when they harm US national security while taking advantage of the nation’s financial system.

Adeyemo said that “we fear that without Congressional action to provide us with the necessary tools, the use of virtual assets by these actors will only grow.” 

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