The U.S. House of Representatives has approved a bill intended to prevent the misuse of digital assets, marking another development in the rapidly changing regulatory landscape around cryptocurrencies.
TakeAway Points:
- the U.S. House of Representatives plans to establish a Treasury-led commission to fight money laundering and terrorism related to cryptocurrencies, but Senate passage is improbable.
- The goal of the bill is to safeguard digital assets and bolster national security.
- Comprehensive crypto legislation before the 2024 presidential election is unlikely due to the split Congress, even with bipartisan backing in the House.
U.S House of Rep Approves Crypto Legislation
The U.S. House of Representatives has taken another step in the evolving landscape of cryptocurrency regulation by approving a bill aimed at curbing the misuse of digital assets. Sponsored by Rep. Zach Nunn (R-Iowa), the bill was passed through a routine voice vote. This legislation seeks to establish a temporary working group under the Treasury Department to investigate the use of digital assets in terrorism and money laundering. The group will include industry figures, such as members from “blockchain intelligence companies,” to provide comprehensive recommendations on addressing these issues.
Rep. Nunn emphasized the importance of this legislation in a speech on the House floor, stating it is “crucial in strengthening America’s national security, protecting our digital assets and ensuring the next generation of financial and internet technology is built right here in America.” Despite the bill’s approval in the House, its future remains uncertain as it faces potential hurdles in the Senate.
Influence on Politics
The bill’s passage highlights the political dynamics surrounding cryptocurrency regulation. Jaret Seiberg, a TD Cowen analyst, noted that the bill serves multiple political purposes.
“For crypto critics, this is a way to register their demands for money laundering crackdowns,” Seiberg said in a client note on Monday.
“And for crypto advocates, this gives them political cover from attacks that their support for digital assets facilitates money laundering and criminal activity.”
The bill’s approval comes at a time when cryptocurrency has become a significant political topic, especially in the context of the 2024 presidential contest. However, the likelihood of a narrowly divided Congress agreeing on a comprehensive regulatory approach to the industry remains slim. This uncertainty has led crypto insiders to closely monitor other relevant provisions, such as those being considered for the National Defense Authorization Act, which sets the nation’s defense priorities annually.
Industry’s Call for Support
In a related development, the Digital Chamber sent a letter to Vice President Kamala Harris, urging her to adopt a more crypto-friendly stance. The letter asked Harris to “take a forward-looking approach on digital assets and blockchain technology” by incorporating a positive crypto position into the party’s official platform. It also suggested that she choose a running mate “with a proven track record of engaging with digital asset technology and proposing pro-innovation policies.”
This letter echoes sentiments from other prominent industry participants who have similarly called for potential Democratic leaders to adopt a more supportive approach towards cryptocurrency. The industry’s push for favorable policies underscores the growing importance of digital assets in the broader financial and technological landscape.
