In a surprising alignment of forces, Wall Street banks have found themselves agreeing with a frequent critic, Senator Elizabeth Warren, on the need to regulate the burgeoning cryptocurrency industry more robustly.
Bank Policy Institute Backs Legislation
The Bank Policy Institute (BPI), a trade group for lenders that have often been at the receiving end of Senator Warren’s scrutiny, has publicly endorsed bipartisan legislation that she reintroduced this week alongside three Senate colleagues. The bill proposes stricter anti-money laundering rules and counter-terrorism financing measures specifically for the cryptocurrency sector.
In a statement, BPI declared, “The existing anti-money laundering and Bank Secrecy Act framework must account for digital assets, and we look forward to engaging in this process to defend our nation’s financial system against illicit finance in all its forms.”
Unveiling The Crypto Regulation Bill
The bill, announced on July 28th, carries the support of Warren, Democrat Joe Manchin of West Virginia, and Republicans Roger Marshall of Kansas and Lindsey Graham of South Carolina. This unprecedented legislative measure aims to enforce more stringent identification standards on entities within the crypto industry, including digital-asset wallet providers and blockchain transaction validators.
The proposal also mandates new examination procedures for cryptocurrency companies. The Treasury Department, Securities and Exchange Commission, and the Commodity Futures Trading Commission would be responsible for monitoring compliance with the expanded anti-money laundering and counter-terrorism financing requirements.
Warren Turns Up The Heat on Crypto
Since the 2008 financial crisis, Senator Warren has been a persistent thorn in the side of traditional financial institutions, pushing for more stringent regulations. Recently, she has shifted her focus to digital asset firms, echoing sentiments of traditional banks that have called for a tougher regulatory regime in the crypto space.
Support for the bill extends beyond Wall Street and Capitol Hill. The Massachusetts Bankers Association, the AARP, the National Consumer Law Center, and the National Consumers League are among the entities rallying behind the proposed legislation.
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