US Senator Pat Tomei has urged Treasury Secretary Janet Yellen to make “significant amendments” to crypto regulation proposed by the Financial Crimes Enforcement Network (FinCEN) and to employ guidance issued by the Financial Action Task Force (FATF).
Senator Asks Janet Yellen to Revise Proposed US Crypto Regulation
US Senator Pat Tomy wrote a letter to Treasury Secretary Janet Yellen on Thursday about the US approach to cryptocurrency regulation. “I write to raise concerns with two proposals involving the Treasury Department concerning the regulation and oversight of cryptocurrencies,” he began.
The first concern concerns FinCEN’s proposed rule one for cryptocurrency transactions and the other pertains to FATF guidance on cryptocurrencies and virtual asset service providers (VASPs). The senator described:
While I agree that the FinCEN and FATF proposals are seeking to address the misuse of cryptocurrencies for illegal activities, if they are adopted, they will serve as a way to address financial technology (fintech), fundamental privacy of Americans, and to combat illegal activity. efforts will have a detrimental effect. I urge you to make important amendments in them.
The senator spent the first part of his letter explaining that “fostering financial innovation is important” to the US. stands to improve dramatically.”
Tommy then insisted that FinCEN’s proposed crypto rule would “have a negative impact” on the US, citing two key reasons. First, it will impose “heavy recordkeeping” and reporting requirements on crypto transactions “that go beyond the current requirements for US dollar transactions.” Secondly, he argued:
FinCEN’s proposed rule could prove counterproductive in combating illegal activity… By limiting personal privacy and the ability to conduct transactions with financial institutions, the rule would potentially lead bad actors to use methods that Do not interface with financial institutions.
“As a result, such cryptocurrency transactions will be less vulnerable to proper government oversight and identification,” he continued.
The senator then pointed out that some reporting requirements for USD transactions have not been updated for more than 40 years. “The current requirements on the US dollar are no longer appropriately designed to identify illegal activity,” he said, urging Treasury Secretary Yellen to investigate whether they are “suitable for US dollar transactions.” ” He stressed that in some cases cryptocurrencies are “more easily traceable than transactions using US dollars”.
Drawing attention to the FATF’s guidance, Senator Tommy stressed:
The FATF’s guidance would move cryptocurrency transactions away from financial institutions, reducing the ability of law enforcement and analytics firms to identify and track illegal activity. The FATF should revise its guidance to focus on transactions and entities that warrant regulation.
Concluding his letter to Yellen, the senator said the US should “support financial innovation, not stop,” adding: “I urge you to take a more thoughtful approach to identifying illegal activity so that financial May innovation flourish and Americans have privacy. Respected.”
Do you think Treasury Secretary Yellen will heed the advice of Senator Toumney? Let us know in the comments section below.
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