U.S. Senator Elizabeth Warren has gained the support of nine other senators for her Digital Asset Anti-Money Laundering Act, reinforcing her efforts to address the perceived risks associated with cryptocurrencies. Democratic Senators Gary Peters, Dick Durbin, Tina Smith, Jeanne Shaheen, Bob Casey, Richard Blumenthal, Michael Bennet, and Catherine Cortez Masto, as well as independent Senator Angus King, have joined the coalition supporting the bill.
Senator Warren emphasized the role of cryptocurrencies in enabling illicit activities such as money laundering, fraud, and funding for cyberattacks. She described the Digital Asset Anti-Money Laundering Act as a robust proposal that cracks down on the illicit use of cryptocurrencies while empowering regulators with more tools.
The bill, initially introduced in December of last year and re-submitted in August 2023, aims to close regulatory loopholes and bring the digital asset ecosystem into compliance. It seeks to extend the regulatory framework that traditional financial institutions adhere to cryptocurrency firms, subjecting them to Know Your Customer (KYC) and Anti-Money Laundering (AML) requirements outlined in the Bank Secrecy Act (BSA).
One specific focus of the bill is noncustodial, or “unhosted,” crypto wallets. These wallets are considered software or hardware that enable the storage and secure transactions of digital assets with full control given to the wallet owner. The legislation requires banks and money service businesses to verify identities, maintain records, and file reports for digital asset transactions involving unhosted wallets or wallets hosted in non-compliant jurisdictions.
Additionally, the bill introduces a reporting requirement for U.S. residents with over $10,000 worth of cryptocurrency held in accounts outside the country.
The support of these senators indicates a willingness in Congress to take action regarding cryptocurrency regulation. Senator Warren has been critical of cryptocurrencies in the past, linking them to illicit finance and calling for increased compliance with anti-money laundering standards.
Overall, the Digital Asset Anti-Money Laundering Act aims to bring greater transparency and oversight to the cryptocurrency industry, ensuring it aligns with existing financial regulations and combating illicit activities associated with the use of cryptocurrencies.
– Digital Asset Anti-Money Laundering Act: Proposed legislation Senator Elizabeth Warren that seeks to regulate and tackle the illicit use of cryptocurrencies.
– Know Your Customer (KYC): The process which financial institutions verify and authenticate the identity of their customers.
– Anti-Money Laundering (AML): Measures and regulations designed to prevent the illegal generation of income through money laundering.
– Bank Secrecy Act (BSA): U.S. legislation that requires financial institutions to maintain records and report certain transactions to prevent money laundering and other financial crimes.
– Elizabeth Warren’s official website
– The New York Times