Reintroduced Congressional Bill Could Call for Feds to Study Terrorist Uses for Crypto

A new bill introduced to both the U.S. Senate and House of Representatives on Thursday would require the federal government to study how terrorists or other criminals might use cryptocurrencies and other new financial technologies for illegal activities…

The bipartisan Financial Technology Protection Act is co-sponsored by Senators Kirsten Gillibrand (D-N.Y.) and Ted Budd (R-N.C.) and Congressmen Zachary Nunn (R-Iowa) and Jim Himes (D-Conn.). The proposed working group would be composed of representatives from various government agencies, including the U.S. Treasury Department, Financial Crimes Enforcement Network (FinCEN), the Internal Revenue Services (IRS), the Office of Foreign Asset Control (OFAC), the FBI, the Drug Enforcement Agency, the Department of Homeland Security, the Department of Justice, the Department of State and the CIA.

The group would also include industry representatives from analytics firms, financial institutions, research organizations, and other financial technology companies.

The goal of this bill is to create an analysis of the potential threat vectors of adversaries, not just for cybercriminals but also for terrorists, cartels, and nation-states that use illicit money laundering to purchase weapons, traffic people, and buy fentanyl. The analysis will help develop a regulatory structure that responds to these threats, according to Congressman Nunn. The bill outlines various deadlines for the working group, ranging from annual reports on what the group did over the past year and what recommendations it has to a final report four years after the bill is signed into law and other interim documents. Congress would be briefed on the results of these different reports.

It’s essential to note that the bill does not get into the broader conversation in Congress about how crypto should be regulated. However, it is a step in the right direction, as the group’s findings could help lawmakers draft more targeted legislation that balances the need for regulatory oversight with the growth potential of the cryptocurrency industry. This bill could lead to a more unified approach to addressing illicit finance from industry participants. As the cryptocurrency market continues to mature, it is essential to have a clear regulatory framework that both supports innovation and ensures the safety of the financial system.