Senator Elizabeth Warren (D, MA) announced the re-introduction of the bipartisan “[S.2669] Digital Asset Money Laundering Act” in the Senate late last week and added two, powerful new co-sponsors and a well-known industry trade group for lenders called the Bank Policy Institute. The bill looks to tighten rules around Anti-Money-Laundering (AML) and Know Your Customer (KYC) requirements.
In addition to Senator Roger Marshall (R, KS) who co-sponsored the bill in the last Congress, Senators Joe Manchin (D, WV) and Lindsey Graham (R, SC) have come aboard. Manchin says in the release, “Our bipartisan legislation would curtail these security risks and require cryptocurrency platforms to abide by the same anti-money-laundering rules that banks have to follow.”
The press release also notes that the recent NDAA amendment co-sponsored by Sens. Kirsten Gillibrand (D, NY), Cynthia Lummis (R, WY), Warren and Marshall overlaps with the re-introduced bill. How the two play out in the coming weeks may be driven on the final version of the NDAA as the Senate and House negotiate.
The bill has been referred to the Senate Banking Committee.
Warren and Graham have separately formed a partnership with a bill called, “Digital Consumer Protection Commission Act” targeting “big tech.”
Senate AML-KYC – 3 bills
As the Senate continues to launch bipartisan cryptocurrency legislation efforts, not to be forgotten is the bill from Senator Jack Reed (D, MI). [S.2355] “Crypto-Asset National Security Enhancement Act of 2023” (CANSEE) has bipartisan co-sponsors Senators Mark Warner (D, VA), Mike Rounds (R, SD) and Mitt Romney (R, UT).
That’s three bills (including the NDAA amendment) in the Senate – which has a Democratic majority. The bipartisan message is clear: digital assets crime needs to be addressed.
But legislation that unlocks innovation in digital assets in the Senate? Only Lummis-Gillibrand’s [S.2281] Responsible Financial Innovation Act (RFIA) has tried to address it thus far. Gillibrand and Lummis already stated that the NDAA amendment is a needed first step if a broader digital assets bill is going to make it.
Meanwhile in the Republican-controlled House, bipartisan innovation-forward bills from House Financial Services (HFS) and Agriculture Committees are heading for a floor vote.
Energy and Commerce
In the U.S. House of Representatives, the confluence of blockchain technology and government policy isn’t limited to the House Financial Services and Agriculture Committees.
Represenatives Gus Bilirakis (R, FL) and Jan Schakowsky (D, IL), who serve as Chairman and Ranking Member of the Innovation, Data, and Commerce Subcommittee (part of the Energy and Commerce Committee), announced on Friday that the two had sent a letter to Apple CEO Tim Cook expressing concerns about Apple’s App Store restricting use of apps that employ blockchain technology such as NFTs.
According to Chair Bilirakis blog, ” the lawmakers outlined broader concerns about how Apple’s policies may be negatively impacting American leadership in emerging technologies.” Read more. And, see the letter.
This same subcommittee had its first blockchain-related hearing back in early June called “Building Blockchains: Exploring Web3 and Other Applications for Distributed Ledger Technologies. Read blockchain tipsheet’s coverage here and here.
Waters on stablecoin bill
Rep. Maxine Waters (D, CA), Ranking Member of the House Financial Services (HFS) Committee was adamant in Punchbowl News’ Friday edition that the stablecoin bill has no future beyond the House without more negotiation. As it stands, the bill is headed to the House floor for a vote that’s expected in September/October. “Because if you pass it — guess what? It goes to the Senate? I don’t think so. Nothing else happens,” says Ranking Member Waters. She believes the Federal Reserve must have more authority (and less for states) in the new stablecoin regime. Read more.
On the Republican side, the sense was that the White House was not negotiating in good faith. In coverage of Thursday’s HFS hearing on blockchain tipsheet, Chair Patrick McHenry (R, NC) stated during the stablecoin bill’s markup, “The Chair made a decision to move forward the markup today, the Administration needs to see clearly that there’s a majority supportive of the votes on this committee for regulatory clarity, legal clarity for stablecoins and a federal floor which is what this represents.”
In spite of the rift at the top of the Committee, 5 Democrats – Reps. Jim Himes (CT), Josh Gottheimer (NJ), Ritchie Torres (NY), Gregory Meeks (NY) and Wiley Nickel (NC) – ended up supporting the bill.
On the Unchained Podcast by Laura Shin, House Financial Services Committee member Rep. Ritchie Torres (D, NY) spoke late last week to the growing realization by many of the generational divide in Congress when it comes to digital assets.
Rep. Torres told Shin, “Yesterday, the Financial Services Committee in the House passed a market structure bill on a bipartisan basis. And the bipartisan support came from younger Democrats like myself, who are open to embracing the potentialities of blockchain technology. So I see it as more as a generational divide, and as Congress becomes less of a gerontocracy over time, I suspect the institution will become more open to embracing crypto. ”
more markup coverage
Crypto bills advance – Cap Hill Crypto
Financial Innovation and Technology for the 21st Century Act Markup; The Blockchain Regulatory Certainty Act Passes Congressional Committee – DeFi Education Fund
still more tips
Sequoia Capital Slashes Crypto Fund as It Downsizes Amid Startup Crunch – The Wall Street Journal
Despite Uproar, Crypto Bounties to Unmask Bad Actors Starts to Get Traction – CoinDesk
The British Museum Will Enter the Metaverse via ‘The Sandbox’ – Decrypt
Binance’s Founder Changpeng Zhao Drew Scrutiny From German Regulator – The Wall Street Journal