The Blockchain Association Raises Concerns Over Senator Warren’s Anti-Crypto Legislation

The Blockchain Association has issued a second letter raising concerns about a proposed bill introduced by Senator Elizabeth Warren.

Blockchain Association warns that Warren’s anti-crypto legislation jeopardizes US jobs and strategic advantage.

By Ruholamin Haqshanas

📅 Last updated: February 13, 2024 03:03 EST | ⏱️ 2 min read

🌐 Source: Reuters

The Blockchain Association has recently expressed concerns over a bill sponsored by Senator Elizabeth Warren. Titled the Digital Asset Anti-Money Laundering Act of 2023 (DAAMLA), the legislation has gained support from 19 other Senators as co-sponsors, raising alarm bells within the crypto community.

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In November of 2023, the Blockchain Association initially sent a letter with 40 signatories from former U.S. military, national security, and intelligence officers. This recent letter, however, boasts 80 signatories from individuals with similar backgrounds.

Policy Implication of Warren’s Anti-Crypto Legislation

While the first letter aimed to dispel the exaggerated narrative linking cryptocurrencies to the 2023 Hamas-led attack on Israel, the new letter shifts the focus to the policy implications of Warren’s DAAMLA legislation.

According to the Blockchain Association, Warren’s bill poses significant risks to the nation’s strategic advantage, threatens tens of thousands of U.S. jobs, and offers little efficacy in combating illicit actors in the crypto space.

The letter is a response to a previous letter from Warren that accused the association of mobilizing former defense, national security, and law enforcement officials to undermine bipartisan efforts in Congress to address the financing of terrorist organizations through cryptocurrencies.

Warren’s allegations were in reference to the Blockchain Association’s coordination of a visit to Capitol Hill to discuss the concerns raised in their initial letter. Similar letters were also sent to Coinbase and the think tank Coin Center.

In their new letter to Warren, the Blockchain Association criticizes her for questioning the motivations and integrity of numerous U.S. military and intelligence veterans without addressing the substance of their arguments.

Notably, the Chair of the Senate Banking Committee, Senator Sherrod Brown (D-OH), has not yet endorsed DAAMLA or any other legislation. As the committee chair, Brown holds significant influence over whether crypto-related legislation advances from the committee to the full Senate for consideration.

DAAMLA Puts U.S. Jobs at Risk: Blockchain Association

The Blockchain Association’s letter argues that DAAMLA jeopardizes the nation’s strategic advantage, puts tens of thousands of U.S. jobs at risk, and has minimal impact on targeting illicit actors.

“The Digital Asset Anti-Money Laundering Act (DAAMLA) risks our nation’s strategic advantage, threatens tens of thousands of U.S. jobs, and bears little effect on the illicit actors it targets,” the letter said.

One contentious aspect of the bill is the inclusion of bitcoin miners and validators of other blockchains as responsible parties for conducting Know-Your-Customer (KYC) and Bank Secrecy Act (BSA) regulations. Many industry experts argue that this approach is unworkable given the nature of blockchain technology.

In March, the Blockchain Association plans to coordinate another visit to Capitol Hill to engage policymakers in a detailed discussion about the issues surrounding the DAAMLA legislation.

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Q&A Content

Q: How does Warren’s bill pose significant risks to the nation’s strategic advantage?

A: According to the Blockchain Association, the Digital Asset Anti-Money Laundering Act (DAAMLA) put forth by Senator Warren poses substantial risks to the nation’s strategic advantage by stifling innovation and driving away industry talent. By imposing burdensome regulations on cryptocurrencies, the bill could hinder the growth and development of blockchain technology within the United States, potentially disadvantaging the country in the global digital economy.

Q: What are the concerns raised by industry experts regarding bitcoin miners and validators being responsible for conducting KYC and BSA regulations?

A: Industry experts argue that including bitcoin miners and validators as responsible parties for conducting Know-Your-Customer (KYC) and Bank Secrecy Act (BSA) regulations is unworkable due to the decentralized nature of blockchain technology. Miners and validators play a crucial role in securing the network and verifying transactions, but they do not have direct control over the identities of the participants. Imposing KYC and BSA obligations on these entities could undermine the privacy and security benefits that cryptocurrency users enjoy.

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The concerns raised by the Blockchain Association shed light on the potential ramifications of Senator Warren’s anti-crypto legislation. As the debate around crypto regulation intensifies, it is crucial for policymakers to consider the long-term effects on the industry and the economy. Finding a balance between security and innovation is key to ensuring the continued growth and prosperity of the blockchain technology.

References: 1. US Senators Seek Gary Gensler’s Report on X-Breach 2. Letter with 40 signatories 3. Recent letter to the House Financial Services Committee and Senate Banking Committee 4. Twitter post about Warren’s allegations 5. Coinbase 6. Think tank Coin Center 7. Follow Us on Google News

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