- Senator Elizabeth Warren is suggesting building an “anti-crypto army” in her new war campaign
- The crypto regulation tenents proposed by Warren provide no environment for profit and growth for all DeFi sectors
- The crypto community accuses Elizabeth Warren of indirectly laying a foundation for the U.S. CBDC
According to reports, Senator Elizabeth Warren’s re-election campaign will place a strong emphasis on the cryptocurrency industry. Senator Warren’s most recent Twitter post urging voters to join her campaign highlighted her plans and previous accomplishments.
They include the availability of over-the-counter hearing aids and the lowering of the cost of childcare in the state of Massachusetts. Among the accomplishments mentioned in the post was Senator Elizabeth Warren’s plan to “build an anti-crypto army” in the United States.
Elizabeth Warren plans to build an anti-crypto army
Senator Elizabeth Warren is positioning herself as the crypto scourge. And she’s not doing it by herself. The progressive Massachusetts Democrat is beginning to recruit conservative Senate Republicans to her anti-crypto campaign. She is receiving early positive feedback from bank lobbyists, who also want to limit the growth of digital asset startups.
Warren has emerged as a crypto oversight leader, attempting to rally support for a bill that would have far-reaching implications for the industry through tougher anti-money laundering restrictions, such as requiring more crypto service providers to verify customer identities.
Elizabeth Warren’s disdain for the crypto industry isn’t new. The Massachusetts senator has been working for years to limit the spread of crypto in the United States. Her efforts culminated in introducing the Digital Asset Anti-Money Laundering Act of 2022 in December 2022.
The bill was widely criticized at the time, both by Republicans and fellow Democrats, with the broader crypto and tech industries warning about the potentially dangerous implications.
Elizabeth Warren pledged in February to reintroduce the bill, which would require all decentralized entities to comply with stringent AML requirements, this year.
She also commended the nation’s securities regulator and its chairman, Gary Gensler, for their efforts to monitor the cryptocurrency industry. She urged lawmakers to provide the watchdog with the resources and authority it needs to maintain order. She widely praised the commission’s enforcement actions against Kim Kardashian and cryptocurrency exchanges such as Coinbase for possible insider trading.
Last week, Warren and another colleague urged the Public Company Accounting Oversight Board (PCAOB) to take action against “sham audits” of cryptocurrency firms, citing the potential damage to the auditing system’s integrity.
How will Warren’s stand affect the crypto industry?
Elizabeth Warren has reintroduced her Anti-Money Laundering Act, which would make it largely illegal for you to use your crypto wallet. Although the stated objective of the proposal is to protect Americans from fraud, it is more likely to drive cryptocurrency businesses overseas and reduce consumer choice.
It prohibits the use of digital asset mixers. It mandates Anti-Money Laundering (AML) policies for self-hosted wallets, such as those stored on a mobile phone, and miners and validators. Many of these entities may not be able to impose such requirements, meaning that they would have to cease operations or cease serving American users.
The proposal is inappropriate at the present time. Recent high-profile frauds and thefts demonstrate the need for crypto regulations and enforcement. Still, the proposed legislation amounts to a smear campaign against the industry that would increase Americans’ reliance on traditional banks.
However, she is in error when she asserts that cryptocurrency is the preferred method of international drug traffickers and terrorists. Approximately $10 billion or less in crypto is involved in money laundering annually, compared to $800 billion to $2 trillion in conventional currencies.
The bill is particularly harsh on noncustodial DeFi platforms, requiring them to record users’ personal information and submit it to the government without a warrant or probable cause.
The bill also classifies all miners as money service businesses, including those who mine for themselves rather than processing transactions for others. It also ignores the fact that miners can provide non-transactional services.
The most absurd requirement would be for software developers to register as money service providers, implement anti-money laundering policies, and report customers to the Financial Crimes Enforcement Network. According to this logic, electronics retailers such as Best Buy and Micro Center should register as money service providers because the cell phones they sell can be used to commit fraud.
Warren also appears unaware that blockchain and related technologies are distinct from crypto and that not all cryptocurrencies can be freely traded or used to make purchases.
Elections in the United States are notorious for bringing out the worst in leaders, and candidates must run on an agenda to enter Congress. For Elizabeth Warren, the very crypto she condemns is her ticket to the top. Double standards? Fortunately, crypto survives to fight another day.