As many of you are aware, the Foundation has dedicated a large chunk of its resources over the past few months into proposing redrafts of sections of §1241 Combating Money Laundering, Terrorist Financing and Counterfeiting Act of 2017 (US).
For those not familiar with the Act, it seeks to define anyone issuing, redeeming, or cashing Bitcoin as a financial institution. This would require them to comply with the Bank Secrecy Act, 31 U.S.C. § 5312 and require them to adopt the same formal reporting procedures as financial institutions for the purpose of reporting suspicious transactions. For further context see this post. Our high level position is that this is an untenable and premature regulatory burden on a promising technology that is not a financial instrument.
The support in opposing §1241 has been superb. Thank you to all our members and supporters who participated in surveys and interviews, called their local senators, signed our petition and donated funds towards legal fees.
The Foundation’s feedback was presented by the Foundation’s counsel to Senator Grassley’s office on November 22, 2017 and we would like to share that letter with you.
At minimum, the Bitcoin Foundation believes that further research and review of this developing and complex area is needed before AML obligations are applied. In the event that these provisions are not deleted from the current Bill, the Bitcoin Foundation has proposed amendments and outlined reasons for those amendments.
A judiciary committee hearing regarding §1241 was held on November 28, 2017, resulting in additional comments from the Foundation on November 30, 2017.
The overall record before the Judiciary Committee supports our recommendation that, if virtual currencies were to be involved in §1241, the Bill should focus on the role of corporate professional exchangers of virtual currencies with fiat currency specifically identified by the Treasury Department. The Bitcoin Foundation continues to oppose much of Section 13 of the Bill, and, in the event that these provisions are not deleted from the current Bill, maintains its proposed amendments.
We look forward to keeping America innovating with this transformative new technology.