The US Treasury has published guidelines on its stance on cryptocurrencies when it comes to counter the illegal use of cryptocurrency to circumvent sanctions.

According to new rules, addresses of cryptocurrency wallets owned by persons from the sanction list of the Office for Control of Foreign Assets (OFAC), are subject to freezing the same way as in the case with bank accounts.

OFAC will add cryptocurrency addresses to the sanctions lists to notify the public and identify the addresses associated with the criminal and malicious actors, methodological materials read.

"OFAC will use sanctions in the fight against criminal and other malicious actors abusing digital currencies and emerging payment systems as a complement to existing tools, including diplomatic outreach and law enforcement authorities."

Now, US-based companies that deal with cryptocurrencies are required to block cryptocurrency assets if they are owned by a sanctioned person and report this fact to OFAC.

"U.S. persons (and persons otherwise subject to OFAC jurisdiction) must ensure that they block the property and interests in property of persons named on OFAC’s SDN List or any entity owned in the aggregate, directly or indirectly, 50 percent or more by one or more blocked persons, and that they do not engage in trade or other transactions with such persons."

In order to identify ownership of cryptocurrency assets, the OFAC will use existing tools, as well as data from law enforcement agencies, secret information from intelligence services and public data.

OFAC is the US Treasury Department, which is responsible for economic and trade sanctions against countries and individuals accused by the US authorities of involvement in terrorism, drug trafficking, human rights violations, the proliferation of weapons of mass destruction, transnational organized crime and other unlawful activities.

Earlier, US President Donald Trump signed a decree prohibiting US companies and citizens from carrying out transactions with the Venezuelan cryptocurrency El Petro.