Draft law for the expansion of sanctions and AML obligations to developer of decentralized protocols ensures criticism from the crypto industry

Von Krypto News Österreich

Title: New bill to expand sanctions and AML obligations to developer of decentralized protocols meets criticism of the crypto industry

Since the publication of the new bill to expand sanctions and anti-money laundering obligations (AML) on developer of decentralized protocols, the plans in the crypto industry have caused a sensation. The new proposals were introduced by Senator Jack Reed (D-Ri) and have led to a broad debate on the potential effects on the decentralized financial sector (Defi).

Critics of the draft law argue that Defi is naturally decentralized and it could therefore be difficult to enforce control over a certain protocol. Coin Center, a leading crypto organization, has expressed his concern about the scope of legislation and emphasizes that Defi could be legally problematic when it comes to enforcing control measures.

also Kristin Smith, CEO of the Blockchain Association, has joined the concerns of Coin Center and described the new legislation as unenforceable. Smith argues that the draft law is generally overrated the presence of money laundering in defi and cryptocurrencies. She emphasizes that illegal transactions only make up a very small proportion of the total volume and that the federal law enforcement authorities already have the tools and the specialist knowledge in order to effectively combat this problem.

Despite the criticism of the draft law, a report by the US Ministry of Finance on April 7 showed that many defi protocols are more centralized than claimed. The report also showed that some protocols have a high concentration of funds and voting rights in the hands of some fewer tokens.

The debate about the draft law is expected to continue to be intensively conducted because it could have a major impact on the decentralized financial sector. It remains to be seen how the regulatory landscape for Defi and cryptocurrencies will develop and whether changes to the bill will be made to consider the concerns of the crypto industry.

sources:
- @senjackReed, @senatorrounds, @senatorwarner and @senatorromney on Twitter
- Jerry Brito (@jerrybrito) on Twitter
- Coin Center
- CEO of the Blockchain Association (@KMSmithdc) on Twitter
-Report of the US Finance Ministry of April 7th