US Senators Introduce Bill to Crack Down on Crypto

US Senator Elizabeth Warren has announced that five additional senators have signed on to co-sponsor her bill designed to crack down on illicit uses of Bitcoin and other cryptocurrencies.

The bill, which was first introduced into the Senate in December of 2022, has the backing of a bipartisan coalition of senators and aims to extend anti-money laundering laws that apply to traditional financial institutions more comprehensively across the crypto space.

The new co-sponsors of the bill are Senators Raphael Warnock, Laphonza Butler, Chris Van Hollen — all members of the Senate Banking, Housing, and Urban Affairs Committee — and Senators John Hickenlooper and Ben Ray Luján. 

All of the newly announced co-sponsors are members of the Democratic Party. Senator Warren welcomed the new co-sponsors, which bring the bill’s total number of co-sponsors to 19: 

“I’m glad that five new senators are joining the fight to take action, including three members of the Banking Committee. Our bipartisan bill is the toughest proposal on the table cracking down on crypto’s illicit use and giving regulators more tools in their toolbox.”

US Senator, Elizabeth Warren

Warren has been a staunch advocate of stronger crypto regulations to prevent its use by criminals, and has in the past cited crypto as a key funding source for Hamas and North Korea’s nuclear weapons program.

Bill Intended To Curb Money Laundering

The primary purpose of the bill, officially known as the Digital Asset Anti-Money Laundering Act, is to restrict the ability of organised crime groups, terrorist organisations and hostile regimes to use crypto networks to launder assets and fund their activities.

The bill proposes extending the definition of ‘financial institutions’ to include key components of crypto infrastructure, such as:

This would allow regulators to specifically craft provisions to increase oversight of crypto networks and enhance the transparency of crypto transactions — thereby minimising money laundering but also potentially impacting the privacy of legitimate crypto users.

Bill Divides Opinion

Cybersecurity expert Steve Weisman supported the legislation when he appeared before a senate hearing in November, describing it as a “no-brainer” to combat the growing problem of crypto-based money laundering. 

Unsurprisingly, the prospect of regulating cryptocurrencies like traditional financial institutions is a divisive issue. A number of people in the crypto community expressed scepticism of the US Government’s motivations and their fears it was a cover for gaining control over the technology.

Neeraj Agrawal, from the crypto policy think tank, Coin Centre, took to X to argue the bill is an attack on “our personal privacy and autonomy” and a move towards a surveillance state: