Republican Senator Roger Marshall has pulled his support for the Digital Asset Anti-Money Laundering Act (DAAMLA). He co-sponsored this bill with Democratic Senator Elizabeth Warren in 2022. This move leaves the bill with 18 remaining supporters. The official Congress directory for the legislation notes this change.
The DAAMLA bill was introduced by Senators Marshall and Warren in December 2022. Senator Warren argued that cryptocurrencies are used by “rogue nations, oligarchs, drug lords, and human traffickers” to launder stolen funds. The bill aims to bring the crypto industry under existing Anti-Money Laundering (AML) and Counter-Terrorist Financing (CTF) regulations.
Key Elements and Opposition
One key element of the bill is to classify a broad range of crypto service providers as financial institutions. This includes decentralized wallet providers, validators, and miners. These entities would be required to comply with the Bank Secrecy Act. This act imposes stringent reporting and record-keeping requirements.
In July 2023, Senator Warren reintroduced the DAAMLA bill to the US Senate. The bill specifically targets the illicit use of crypto assets for money laundering and terrorist financing.
However, the proposed legislation has faced significant backlash from various crypto organizations and individuals. Critics argue that the bill exaggerates the role of cryptocurrencies in funding terrorism and illicit activities. They warn that it could severely impact the US crypto industry.
On February 20, the Chamber of Digital Commerce, a US-based crypto advocacy group, urged the Senate Banking Committee to reject the DAAMLA bill. The group argued that the bill would “erase hundreds of billions of dollars in value for US startups.” It would also “decimate the savings of countless Americans” who have legally invested in cryptocurrencies.
Additionally, on February 13, a group of 80 former military and national security officials from the US government sent a letter to lawmakers. In the letter, they warned that the DAAMLA bill would hinder law enforcement efforts. It would also increase national security concerns by “driving the majority of the digital asset industry overseas.”
Political Implications and Future Prospects
Senator Warren, who is running for reelection in 2024 to represent Massachusetts, continues to push for the bill despite the opposition. On February 20, pro-crypto lawyer John Deaton announced his intention to run as a Republican to unseat Warren. Deaton’s campaign will highlight his opposition to the DAAMLA bill and his support for the crypto industry.
The debate around the DAAMLA bill highlights the growing tension between lawmakers and the crypto community. Supporters of the bill argue that it is necessary to curb the misuse of cryptocurrencies for illegal activities. Meanwhile, opponents believe that the bill goes too far and could stifle innovation and growth in the crypto industry.
Senator Marshall’s withdrawal of support is a significant development. It indicates a shift in the political landscape surrounding the DAAMLA bill. It remains to be seen how this will affect the bill’s progress. The broader regulatory environment for cryptocurrencies in the United States may also change.
The crypto industry will continue to monitor the situation closely. The outcome of this legislation could have far-reaching implications for the future of digital assets in the US. As the debate continues, finding a balance between regulation and innovation will be crucial. This balance is essential for the growth and stability of the crypto sector.
Disclaimer
FAQ
Cryptocurrency is a digital form of currency secured by cryptography, not controlled by governments or banks.
Cryptocurrency wallets are digital tools for storing and managing your crypto assets.
Best practices for crypto investment include research, diversification, investing what you can afford to lose, and avoiding hype-driven investments.
