Fintech
House Approves Anti-Illicit Cryptocurrency Financing Bill That Aims to Create Working Group to Protect Financial Technology
KEY POINTS
- The proposed bill states that the working group should involve major players in the cryptocurrency industry
- The goal is to provide cryptocurrencies with an environment to grow without fear of exploitation, said Congressman Nunn
- House members have increasingly shown support for cryptocurrency-focused legislation
The U.S. House of Representatives on Monday passed a bill to establish a fintech working group focused on combating terrorism and illicit financing in the digital asset sector.
Financial Technology Protection
Introduced by Iowa Republican Representative Zach Nunn, the “Financial Technology Protection Act of 2023“aims to establish an independent working group on financial technology at the Treasury Department that will “combat terrorism and illicit financing” in the cryptocurrency sector.
Under the proposed legislation, the working group must involve not only relevant federal agencies, such as the Treasury’s Financial Crimes Unit and the Department of Justice (DOJ), but also key stakeholders in the cryptocurrency industry.
The working group is expected to include representatives from fintech companies, blockchain intelligence firms, financial institutions, research groups, and institutions or organizations “focused on individual privacy and civil liberties.”
Tasks of the working group
The resolution states that the working group should “conduct research on terrorist and illicit uses of new financial technologies, including digital assets,” and develop regulatory recommendations to improve U.S. efforts to combat terrorism, money laundering, and illicit financing.
The House passage of the bill comes at a critical time for the cryptocurrency industry, as concerns remain about the potential use of digital assets by terrorists and threat actors.
Cryptocurrencies are here to stay: Nunn
During Monday’s session, Nunn noted that “blockchain technology and digital assets are here to stay, and we need an environment where they can grow in the United States without being exploited by adversaries.”
Nunn also stressed the need for collaboration between industry players and federal agencies to protect innovative technologies in the financial world. He said the working group would include “private organizations and their innovation, as well as private sector experts to combat terrorism and illicit financing on digital platforms.”
He said the protections are needed not only to protect the American public from threat actors, but also from U.S. adversaries, including the People’s Republic of China and the Russian Federation.
Nunn’s comments are backed by data, as blockchain intelligence firm Chainalysis said in a 2022 report relationship that certain groups and individuals from Russia “account for a disproportionate share of activity in various forms of cryptocurrency-based crime.”
House Lawmakers Take Cryptocurrency More Seriously Than Ever
More and more House lawmakers are recognizing the potential of cryptocurrencies, as evidenced by the increase in cryptocurrency-related bills passed by the House in recent months, one of which Block the Federal Reserve from the issuance of a central bank digital currency (CBDC).
The bill narrowly passed the House in May, but GOP members who voted for the bill hailed the milestone, saying it would prevent the government from “spying” on American citizens’ financial activities.
Probably the biggest breakthrough in Congress was the passage of a resolution that sought to establish a regulatory framework for cryptocurrenciesThe bill won overwhelming support from Democratic members of the House, signaling a shift in tone among Democrats who had previously remained largely silent on their views on digital assets.