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The United States of America, is without a doubt, the biggest player when it comes to the cryptocurrencies and Blockchain space. And so, every move and quasi-move of her government is watched with steady eyes, because the impact on the cryptoworld can be explosive.

We've seen how much the market is responding to the USA's SEC's potential Bitcoin Spot ETF approval. There have been Bitcoin Spot ETFs in the Canadian Stock Market for some years now, but it hasn't made so much impact. So, that's how much influence the USA has on the space.

Following the need to watch every crypto-related move of the US government, an interesting one to watch is the cryptocurrency bill called the Digital Asset Anti-Money Laundering Act of 2023.

It was introduced by Senator Elizabeth Warren, who is known as the most anti-crypto Senator. This bill contains some grave provisions that can cripple the entire cryptocurrency/Blockchain sphere.

Crypto lobbyists in America and other enthusiasts who know about this bill have decried this bill, and want it to be the last thing to ever come to fruition.

So, today we'd be looking, in detail, at this bill, and its content. For a good understanding of the agenda the American Senators who are anti-crypto have for us.

An Analysis and Explanation of the Digital Asset Anti-Money Laundering Act of 2023

For those of us with a poorer legal background, who don't know what a Bill is, a Bill is a proposed law brought to the lawmaking bodies (the House of Representatives and Senate) for their consideration.

After their consideration, if they vote in favor of it, if the president assents, it becomes law and has to be followed and enforced. If the president doesn't assent but enough members of the House and Senate vote in favor, it can still become law.

So, this Digital Asset Anti-Money Laundering Act of 2023 has been brought to the House for consideration and votes. You can read the full Bill here.

The Bill has 6 sections.

Section 1 (Short Title)

It simply gives the Bill its title "Digital Asset Anti-Money Laundering Act of 2023"

Section 2 (Definitions)

Simply defines certain terms that would be used throughout the Bill.

Section 3 (Digital Assets Requirements)

(a)

(1) Proposes that all the following people are now viewed as Financial Institutions: providers of wallets (Trust Wallet, etc. Any means of getting a crypto wallet), crypto miners, validators, node operators, or:

"other nodes that may act to validate or secure third-party transactions, independent network participants (including maximal extractable value searchers), miner extractable value searchers, other validators or network participants with control over network protocols, or any other person facilitating or providing services related to the exchange, sale, custody, or lending of digital assets"

Do you see that this list includes about everybody involved in the running of Blockchain/cryptocurrencies? They are to now become viewed by law as Financial Institutions! That's the same status Banks have, which would open them up to a lot of laws, regulations, and control from the government.

(2) All these people listed above, as they're now Financial Institutions, shall be directed by the Secretary of the Treasury, through the Director of the Financial Crimes Enforcement Network, on how to go about registration and keeping of records just like other Financial Institutions.

Registration and record requirements are contained in subchapter II of chapter 53 of title 31, United States Code.

But I'm not listing all the requirements here because they are a lot and all of them would not apply. Only the ones chosen by the above government agencies would apply. Also, the subsequent sections address the major ones.

But some of them include:

• Reports on domestic coins and currency transactions,

• Records and reports on foreign financial agency transactions

• Reports on foreign currency transactions

• Reports on exporting and importing monetary instruments

• Search and forfeiture of monetary instruments

• Special measures for jurisdictions, financial institutions, international transactions, or types of accounts of primary money laundering concern

• Whistleblower incentives and protections

• Staff commentaries

• Reports relating to coins and currency received in nonfinancial trade or business

• Bulk cash smuggling into or out of the United States

• Training regarding anti-money laundering and countering the financing of terrorism

• Prohibition on concealment of the source of assets in monetary transactions

(b) (Registration Rules)

The Crypto Facilitators that are now Financial Institutions would be required to register and do things like:

• Provide "the name and address of any depository institution at which the business maintains a transaction account, an estimate of the volume of business in the coming year (which shall be reported annually to the Secretary). Such other information as the Secretary of the Treasury may require."

• 'Maintain a list containing the names and addresses of all persons authorized to act as an agent for such business in connection with activities described in subsection (d)(1)(A) and such other information about such agents as the Secretary may require; and make the list and other information available on request to any appropriate law enforcement agency."

[(c) is omitted because it doesn't deserve much focus]

(d)

Anyone with cryptocurrencies worth more than $10,000 would have to file a report on it.

(e)

The Crypto Facilitators due to their new Financial Institutions status shall be required to do something(s) to mitigate the risks involved with handling, using, or transacting in cryptocurrency.

(What they'd be required to do about these risks shall be decided by the Secretary of the Treasury).

Section 4 (Examination and review process)

This section gives power to The Treasury (in consultation with the Conference of State Bank Supervisors), The Securities and Exchange Commission (SEC), and the Commodity Futures Trading Commission (CFTC) to come up with a process to examine and review these Crypto Facilitators to prevent money laundering and the financing of terrorism.

Section 5 (Digital Assets Kiosk)

Digital Assets Kiosks are crypto ATMs. This section provides that they'll have to: submit the address of all their ATMs, identify their users using government-issued ID, and have the name and address of any party to the transaction.

The Financial Crimes Enforcement Network would investigate unlicensed crypto ATMs. The Drug Enforcement Administration (in consultation with other agencies) would come up with ways to combat Drug Trafficking using crypto ATMs.

Section 6 (Authorization of appropriations)

Simply authorizes the government to give the Secretary of the Treasury the money required to enforce this law.

Conclusion

What a Bill! We can already see that such a close watch would be kept on the entire system that facilitates cryptocurrencies.

That's not such a bad thing, but the registration requirements and opening up Crypto Facilitators to regulations from so many government agencies can turn out to be very dangerous to the progress of the space.

That is because regulations would be made by agencies that don't necessarily understand cryptocurrencies, any sort of progress inhibiting regulations can be made.

Also, there are already several ways the government can fight money laundering and other financial crimes without the passing of this law. The government already uses these ways and has seized a lot of assets from criminals, arrested them, and locked them up.

The government simply needs to continue with those, rather than throw crypto open to all these agencies and whatever they might come up with.

The End

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