US Banking Advocacy Group Supports Senator Warren’s Anti-Money Laundering Bill

In a recent report, the US banking advocacy group led by the Bank Policy Institute (BPI) supported a crypto bill proposed by Senator Elizabeth Warren. In her submission, the Senator requested the regulators to formulate Anti-Money Laundering (AML) regulations for digital assets.

The Senator presented the Digital Asset Anti-Money Laundering Act for regulatory scrutiny last year to challenge the current AML rules. The bill was  co-formulated by Senator Joe Manchin, Lindsey Graham, and Rodgers Marshall.

Senator Warren Reintroduces Crypto Bill

A review of the bill demonstrated that the Massachusetts senator demanded clear policies to address money laundering and terrorism in the financial sector. Additionally, Senator Warren’s submission stressed on the need for transparency in the crypto industry.

A scrutiny of the existing AML rules, such as the Bank Secrecy Act, failed to recognize digital assets. This obliged Senator Warren to urge the policy maker to impose new regulations to safeguard the US financial system. Warren added that failure to engage in the rulemaking process could lead to unlawful financial activities in the US.

In her seven-page bill, Senator Warren outlined the responsibilities of digital asset issuers, miners and exchanges. The bill will require the virtual asset service providers to keep proper customer data records, including ID, address, and others.

Furthermore, in a bid to boost the performance of the US financial sector, Senator Warren and team incorporated restrictive measures for financial institutions. Under the new provision, financial institutions will be restricted from using crypto mixers such as Tornado Cash. The bill will prohibit financial institutions from interacting with crypto technologies that conceal blockchain information.

Community Supports Warren’s Bill

Following the submission of the new bill, key players in the US economy have supported the legislation. In an earlier interview, members of the Massachusetts Bankers Association (MBA), National Consumers League (NCL), and National Consumer Law Center (NCLC) believed that the bill would position the US financial sector at a pinnacle point to flourish.

Also, the co-founder of Gemini, Tyler Winklevoss, condemned the legislators against Warren’s bill on his Twitter profile.

Initially, Warren and the team presented the bill for the first time to the US Senate on December 2022. They argued that the current AML policies failed to cover some digital assets.

In a subsequent US Senate Banking Committee meeting, “Crypto crash,” Warren proposed that crypto should be treated similarly to the banking institution. Typically the discussion  aimed at discussing the impact of the FTX bubble burst on the consumers.

Addressing the committee, Warren and his ally Senator Marshall confirmed that the bipartisan bill will require crypto to be regulated under the existing AML rules for financial institutions such as banks and brokers.

She added that the new legislation should ensure the AML rules fully regulate the decentralized finance (DeFi) platforms. Even though the crypto community wants the DeFi platforms to be exempted from the AML policies, Warren noted that such regulation would encourage money laundering.

Financial Criminals Shift to Crypto Payments

She confessed that lately, financial criminals have shifted to the crypto sector. Referring to the recent financial criminal cases orchestrated by North Korean hackers such as the Lazarus group, the legislator admitted crypto assets had been used as a payment method in drug trafficking.

Warren stated that in 2022 over $20 billion in crypto transactions were used in unlawful activities. Even though cash has been the primary payment method in financing terrorism, the United Nations (UN) observed that criminals prefer crypto to local currency.

Recently North Korean hackers have been in the limelight for attempting to transfer cash through Huobi and Binance. In February, an account linked to the Lazarus Group attempted to transfer $1.4 million of stolen funds through the leading crypto exchanges.

The Senator argued that the bad players bypassed the law using the unregulated DeFi platforms. She restated the need to ensure the crypto sector is well-regulated to deter financial crimes.

Editorial credit: Evan El-Amin /

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