US Senator Withdraws Support for Controversial Elizabeth Warren’s Crypto Anti-Money Laundering Bill
There has been a remarkable shift in the U.S. legislative landscape as Senator Roger Marshall, a member of the Republican Party from Kansas, has indeed drawn back his support for the Digital Asset Anti-Money Laundering Act (DAAMLA) which he firstly co-authored with the Democratic Senator Elizabeth Warren.
Marshall Withdrawal Sets the Ground for Potential Drawback of the Bill
The announcement on July 24 of Senator Marshall’s, Marshall’s decision is viewed as the biggest blow to the bill as it has barely seen the light of day yet and it already encounters the storm. This move is in fact a statement of artificial selection of criminal acts and illegal money-hiding process. The regulation was initially released in December 2022, a whopping 18 out of 19 senators are in favor of the DAAMLA. Marshall’s decision, scheduled on the 24th of July, proves to be a serious hit for this legislation, which seeks to beef up drive in cryptocurrencies as money laundering (AML) by trying to use of technological devices to track AML and deposit illicit assets in the USA financial system. We can use the bill to control the behavior of the digital asset service providers so that they can only offer digital money to people who have already identified themselves such as miners, validators, and decentralized wallet providers. Furthermore, a series of activities are underway to prevent the use of cryptocurrencies for money laundering, e.g. crypto companies will fall under the Bank Secrecy Act. Besides, the act will force illegal actors to opt for more legitimate activities.
Industry Concerns and Opposition
Addition of different workarounds to obstructionist plans like visa issuance for family members see authorities trying to strike the right balance between security, privacy, and individuating mitigating the risks of both crime and security threats such as tax evasion through the use of anonymous accounts. Despite the industry’s best efforts to reinvent itself and make by the law, the bill’s provisions were still seen as oppressive to some people. The bill, as one of the reasons for the growth of the industry by innovation and investment, will be greatly limited due to draconian rules
Warren brought back the bill with the help of the Bank Policy Institute in July 2023, which is comprised of big financial organizations such as Bank of America and Citibank that are in favor of the suggested expansion of AML frameworks to cover digital assets. The Blockchain Association, the mouthpiece of the U.S. crypto enterprise, conveyed anxiety that the bill would curb the country’s strategic edge, take away jobs, and cause the very low criminal activity it is supposed to corral through insufficient implementation.
Security and Economic Implications
Seventy-eight ex-military and national security experts as well as the Blockchain Association signaled to the Congress and U.S. citizens about the potential drawbacks of the bill by pointing out that it could lead to the relocation of the digital asset companies. In their view, the result would be a slowdown in the U.S. economy and national security.
The crypto lobbyists have given the Marshall’s recall a thumbs-up. Perianne Boring, the CEO of the Digital Chamber of Commerce, referred to it as a “tremendous success” for the community when she spoke of a senator retracting a bill in support.
Senator Warren Still Backing the DAAMLA Act
Senator Warren, seeking her fourth term, continues to promote DAAMLA as part of her broader campaign to build an “anti-crypto army.” Her stance contrasts sharply with that of former President Donald Trump, who recently adopted a pro-crypto position and received significant support from industry figures like Kraken founder Jesse Powell and the Winklevoss twins.
Trump’s stance reflects a broader shift within the Republican Party, which has incorporated pro-crypto policies into its platform for the 2024 elections. This includes defending the right to mine Bitcoin, opposing Central Bank Digital Currencies (CBDCs), and promoting self-custody of digital assets.
Meanwhile, the Biden Administration’s approach to crypto regulation remains ambiguous. With Vice President Kamala Harris, who was endorsed by President Biden as the Democratic nominee for the coming election, the party’s future stance on crypto is uncertain.
Warren’s Call for Stringent Measures
Notably, Warren recently urged stringent anti-money laundering measures against foreign-owned U.S.-based crypto mining operations, citing significant environmental and national security risks. At a Senate Committee hearing, Warren highlighted the dangers posed by these mining facilities, which she noted are increasingly owned by foreign entities, mainly Chinese nationals.
She pointed out that such mines consume enormous amounts of electricity, potentially destabilizing the power grid, and that many countries have banned crypto mining, leading foreign companies to establish operations in the U.S. Therefore, calling for stronger AML protections to address these vulnerabilities.
Her firm stance against crypto has made her unpopular in the community. Gemini’s co-founders Tyler and Cameron Winklevoss have each donated $500,000 in Bitcoin to “unseat” her as a US Senator and “put an end to” her war on crypto. They have donated $1 million to John Deaton, a crypto advocate and senate candidate, describing him as a “pro-Bitcoin, pro-crypto, and pro-business candidate.”
