Digital Asset Anti-Money Laundering Act of 2022: How it Could Impact Bitcoin Privacy
• Senators Elizabeth Warren and Roger Marshall recently introduced the “Digital Asset Anti-Money Laundering Act Of 2022”, a bill which would require custodial and self-custodial wallet providers and miners to implement know-your-customer (KYC) systems and prohibit financial institutions from interacting with privacy tools such as CoinJoin.
• This bill seeks for the Financial Crimes Enforcement Network (FinCEN) to implement the guidance, which is seen as a direct attack on the personal freedom and privacy of cryptocurrency users and developers.
• The bill would also allow regulatory bodies to file reports and surveil users without a warrant or government request and would classify Bitcoin nodes as money service businesses.
Senators Elizabeth Warren and Roger Marshall recently unveiled the “Digital Asset Anti-Money Laundering Act Of 2022”, a piece of legislation which seeks to curb money laundering through the use of cryptocurrencies. The bill would have sweeping implications for the privacy of bitcoin users, as it would require custodial and self-custodial wallet providers and miners to implement know-your-customer (KYC) systems. Additionally, financial institutions would be prohibited from interacting with privacy tools such as CoinJoin, which are used to restore the users’ ability to use bitcoin in a way that more closely resembles physical cash.
The bill also seeks for the Financial Crimes Enforcement Network (FinCEN) to implement the guidance, which is seen as a direct attack on the personal freedom and privacy of cryptocurrency users and developers. In addition to this, regulatory bodies would be allowed to file reports and surveil users without need for a warrant or government request. The bill also calls for a “rule classifying custodial and unhosted wallet providers, cryptocurrency miners, validators, or other nodes who may act to validate or secure third-party transactions, independent network participants, including MEV searchers, and other validators with control over network protocols as money service businesses”, which would imply that Bitcoin nodes would be classified as such as well.
The implications of this bill are far reaching and could potentially have a huge impact on the cryptocurrency community. It is unclear at this moment in time if the bill will pass, but it is certainly an issue that needs to be monitored as it could have significant implications for Bitcoin privacy and usage as a whole.
