Definition ∞ Section 311 is a provision of the USA PATRIOT Act that grants the U.S. Treasury Secretary authority to designate foreign financial institutions or jurisdictions as primary money laundering concerns. This designation can lead to imposing special measures, such as prohibiting U.S. financial institutions from doing business with the designated entity. In the digital asset space, it serves as a powerful tool to combat illicit finance by targeting foreign virtual asset service providers. It allows for restrictions on financial interactions.
Context ∞ Section 311 is a notable regulatory tool often mentioned in crypto news when the U.S. Treasury Department takes action against foreign entities perceived to be facilitating illicit financial activities using digital assets. Such designations can significantly impact the global operations of cryptocurrency exchanges and other virtual asset service providers. The application of Section 311 signals a strong stance by U.S. regulators against financial crime in the digital asset sector, compelling stricter compliance measures worldwide.
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