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The United States government has removed two provisions from the National Defense Authorization Act (NDAA) that were designed to address anti-money laundering (AML) concerns involving cryptocurrency.
The NDAA is a law that authorizes the use of federal funds by the department of national security. With the general list of conditions removed from the NDAA, two specifically defined a thorough review and reporting process for crypto activities to combat illegal activities.
The first provision ordered the Secretary of the US Treasury to coordinate with banks and government authorities in the organization of a study on the risks and the review of crypto for financial institutions.
The second provision is aimed at preventing transactions of anonymous crypto assets, especially involving crypto mixers and tumblers.
This included the creation of a report detailing the number of transactions of crypto assets related to authorized organizations. In addition, the report will include regulatory approaches used by other jurisdictions.
After that, it will provide guidance on implementing crypto regulations in the US government:
“Proposals for laws or regulations relating to the technology and services described in paragraph (1) and (3).”
On July 28, Cointelegraph reported that the United States Senate passed the $886 billion NDAA.
The crypto-related amendments include elements from the Digital Asset Anti-Money Laundering Act, introduced in 2022, and the Responsible Financial Innovation Act, which seeks to establish safeguards to avoid another FTX-style disruption in business.
This was established by a group of senators, including Cynthia Lummis, Elizabeth Warren, Kirsten Gillibrand, and Roger Marshall.
Related: FinCEN proposes labeling crypto hybrids as money laundering sites
In recent times, the US government has been discussing issues related to money laundering and terrorist financing through the use of crypto.
The Financial Services Committee of the US House of Representatives held a meeting on November 15 to discuss illegal activities in the crypto ecosystem.
During the meeting, there was also a review of how to manage crypto transactions and combine them to provide funds to protect money laundering and financing problems.
Magazine: Lawmakers’ fear and skepticism drive crypto regulation in the US