US Banking Group Supports Senator Warren’s Reintroduced Crypto Bill

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Key takeaways:

  • Senator Warren has introduced legislation that would subject digital assets to specific Anti-Money Laundering (AML) regulations.
  • The BPI has expressed support for the law, which calls for greater openness in digital asset transactions to thwart money laundering and terrorism financing.

Senator Elizabeth Warren, a strong opponent of cryptocurrencies, has introduced legislation that would subject digital assets to specific Anti-Money Laundering (AML) regulations. The Bank Policy Institute (BPI), a lobbying group for American banks, has welcomed this proposal.

The Digital Asset Anti-Money Laundering Act was reintroduced by Senators Lindsey Graham, Joe Manchin, and Roger Marshall, as per the report from Bloomberg. Elizabeth Warren, a senator, said: 

“This bipartisan bill is the toughest proposal on the table to crack down on crypto crime and give regulators the tools they need to stop the flow of crypto to bad actors.”

Warren first proposed the legislation to the US Senate in December 2022, claiming that most of the crypto business is not covered by the current AML regulations.

The BPI has expressed support for the law, which calls for greater openness in digital asset transactions to thwart money laundering and terrorism financing. The BPI noted that the US’s current AML framework does not take into consideration digital assets, saying:

“The existing anti-money laundering and Bank Secrecy Act framework must account for digital assets, and we look forward to engaging in this process to defend our nation’s financial system against illicit finance in all its forms.”

If the seven-page bill is approved, it will be necessary for miners, suppliers of digital asset wallets, and other parties involved in validating and securing blockchain transactions to maintain records of the identities of their clients.

Financial institutions would also be prohibited from employing digital asset mixers, like Tornado Cash, that are intended to conceal blockchain data. 

Among those who favor the legislation are the National Consumers League, the Massachusetts Bankers Association, and the National Consumer Law Centre.

In response to the announcement, Tyler Winklevoss, co-founder of the cryptocurrency exchange Gemini, tweeted on July 28 that individuals opposed to Warren’s planned legislation are “doing the right thing.”

On July 18, Bipartisan legislation to enhance KYC, anti-money laundering, and sanctions rules for DeFi was introduced to the Senate with the support of US Senator Jack Reed. The measure seeks to enforce sanctions legislation necessary for national security while also addressing the rise in crypto-enabled criminality.

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