What’s in Senator Warren’s new Digital Assets Anti-Money Laundering Bill?
The bill proposed by Elizabeth Warren and Roger Marshall aims to bring cryptocurrency firms into the same league as traditional banks.
Senators Elizabeth Warren and Roger Marshall have proposed a bill on Dec. 14 to curb money laundering and terrorist and rogue nation financing via cryptocurrency.
The bill, referred to as the Digital Asset Anti-Money Laundering Act, also seeks to “mitigate the risks that cryptocurrency and other digital assets pose to the United States’s national security by closing loopholes” in the current system.
The proposed law would make it mandatory for United States persons to file a report if they transacted digital assets worth more than $10,000 through one or more accounts outside the United States.
Further, if the legislation is passed, it would extend certain Bank Secrecy Act obligations to cryptocurrencies, including KYC rules that will be applied to cryptocurrency participants, such as wallet providers, miners, and validators.
It would give Financial Crimes Enforcement Network (FinCEN) the authority to implement a proposed rule requiring institutions to report certain transactions involving unhosted wallets, in which users have complete control over the contents rather than relying on an exchange for the transaction.
Additionally, financial institutions will not be able to transact with crypto mixers like Tornado cash, tools designed to obscure funds’ origins, as well as privacy coins.
However, it is interesting to note that section three, part a of the proposed bill requires anyone who writes software that sends, receives, or signs bitcoin transactions, like cryptocurrency miners and validators, to obtain a money transmitter license. Nevertheless, U.S. courts have repeatedly struck down attempts at regulating software creation a number of times.
As part of the bill, Section 4 talks about the responsibilities that certain government agencies would carry out if the bill is passed. The government agencies include the Secretary of the Treasury, the Securities and Exchange Commission (SEC), and the Commodity Futures Trading Commission (CFTC).
The responsibilities include reviewing processes for anti-money laundering programs and reporting obligations undertaken by regulated firms