US Senators Pass Crypto Money Laundering Bill | Inquirer Technology

The US Unveils Its Bipartisan Crypto Money Laundering Bill

05:26 AM December 15, 2022

US Senator Elizabeth Warren and Senator Roger Marshall will push a bipartisan bill against crypto money laundering. 

It would close loopholes allowing digital assets to be used in illicit transactions. Warren said she had warned people about these financial system flaws.


Time constraints kept Warren and Marshall from introducing their new bill in Congress. Consequently, they need to resubmit it once the new Congress is seated.

How will the crypto money laundering bill work?

This represents money laundering.

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Marshall and Warren named their new bill the Digital Asset Anti-Money Laundering Act. It would require crypto networks to comply with the existing anti-money laundering system.

It would direct the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) to consider digital asset wallet providers, validators, miners, and other related entities as money service businesses.

Consequently, it would extend the Bank Secrecy Act to the crypto industry, implementing requirements like Know-Your-Customer (KYC).

That means FinCEN will implement a 2020 rule that requires money service businesses to verify customer and counterparty identities. 

Also, it would record and file reports linked to unhosted wallets and others that do not comply with the Bank Secrecy Act.

The upcoming crypto money laundering bill will forbid banks and other financial institutions from using technologies that promote anonymity.

They also cannot handle digital assets that use such methods. Moreover, the bill would require Americans to file transactions greater than $10,000 with the Internal Revenue Service.

The Digital Asset Anti-Money Laundering Act will require compliance examinations and review processes for money service businesses to enforce the Bank Secrecy Act further.


Lastly, it would crack down on digital asset ATMs by ensuring operators and administrators submit and update physical addresses in their kiosks.

Why are Warren and Marshall passing a crypto money laundering bill?

This is former FTX CEO Sam Bankman-Fried.

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The two senators pushed for the Digital Asset Anti-Money Laundering Act following the indictment of Sam Bankman-Fried for money laundering.

He was the CEO of the FTX crypto exchange platform. According to CoinDesk, a trading firm overseen by his girlfriend, Caroline Ellison, held a position worth $5 billion in FTT, FTX’s native token. 

Also, prosecutors allege Bankman-Fried deceived and defrauded customers, lenders, investors, and the campaign finance system.

Marshall stated, “Following the September 11, 2001, terrorist attacks, our government enacted meaningful reforms that helped the banks cut off bad actors’ from America’s financial system.”

“Applying these similar policies to cryptocurrency exchanges will prevent digital assets from being abused to finance illegal activities without limiting law-abiding American citizens’ access.”


The recent FTX scandal highlights the need for a crypto money laundering bill. Yet, we will have to wait to see if it will spur Congress to pass meaningful digital reforms.

Isaac Boltansky, director of policy research at BTIG, told CNN that it is “exceedingly difficult” to see Congress passing comprehensive legislation despite the “finger-pointing” over FTX.

He said, “Everyone on Capitol Hill can agree that Bankman-Fried is a crook, but when we move from the high level to the ground level, it becomes clear that legislative hurdles and potholes remain.”

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TOPICS: Cybercrime, Laws, Trending, US
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