The continuous growth of the crypto ecosystem reportedly poses a threat to financial stability, forcing the US authorities to propose a bipartisan Digital Asset Anti-Money Laundering Act. Recently, United States Senator Elizabeth Warren announced the expanded coalition of Senate support for the Act.
According to her, senators including “Raphael Warnock (D-Ga.), Laphonza Butler (D-Calif.), Chris Van Hollen (D-Md.), all members of the Senate Banking, Housing, and Urban Affairs Committee, and Senators John Hickenlooper (D-Colo.) and Ben Ray Luján (D-N.M.) have joined the bill as cosponsors. With recent reports that crypto is used to finance terrorism while facilitating the operations of ransomware gangs and acting as a tool for evading sanctions, Warren believes that new laws are needed to crack down on these illicit usages. The new bill would demand a Know-Your-Customer (KYC) verification for wallets, wallet providers, miners, etc.
Warren also expressed her excitement about the five new senators joining the fight to take action. According to her, the bipartisan bill is currently the toughest proposal to crack down on the illicit use of crypto.
Senator Van Hollen also commented on the bill:
The lack of basic legal safeguards around crypto opens up Americans to countless risks. What’s more, crypto has become the payment method of choice for terrorist organizations, drug cartels, and authoritarian regimes to fund their illicit activities. Crypto should be governed by the same transparency rules as traditional banks to protect Americans and help ensure it isn’t used to facilitate illegal behavior by criminal enterprises and rogue nations.
Other Senators Speak on the Crypto-Related Bill
Speaking on this, Senator Hickenlooper explained that the safeguard for banks to ensure user protection should be applied to the crypto industry. According to him, this would protect safe and transparent innovation. The Digital Asset Anti-Money Laundering Act is expected to address the major issues with “unhosted” digital wallets. In addition to strengthening the enforcement of BSA compliance, it would mitigate the illicit finance risks of digital asset ATMs.
Senator Luján commented on this:
Cryptocurrencies operate with little to no oversight. This leaves consumers vulnerable and creates new ways for bad actors to finance terrorism and drug trafficking. I’m proud to join my colleagues in this effort to protect people from the criminal activity that unregulated crypto use has enabled. This bipartisan legislation will establish safeguards to ensure crypto use is met with strong standards to keep Americans safe.
The bill has so far received support from “The Bank Policy Institute, Massachusetts Bankers Association, Transparency International U.S., Global Financial Integrity, National District Attorneys Association, Major County Sheriffs of America, Massachusetts Sheriffs’ Association, AARP, National Consumer Law Center (on behalf of its low-income clients), and National Consumers League.”
Warren has been an active advocate for a bill that mitigates all the threats the crypto industry poses. It can be recalled that she made a profound speech at a hearing on July 21, 2023, warning about the risks of crypto being used as a tool to evade sanctions and fund weapon programs, spying, and cyber attacks. She called out North Korea for stealing $3 billion worth of crypto in the last five years and using the proceeds to fund their illegal nuclear weapons program.
While many believe that this bill could bring sanity to the crypto world, others believe that the original idea of privacy that motivates users to embrace it would be defeated.
