The crypto world continues to grow exponentially, requiring the establishment of a clear legal framework to foster wider adoption and institutional interest. However, many existing regulations hinder innovation. It also contradicts the essence of cryptocurrencies. There are regulators who usually look at cryptocurrencies with a traditional eye. Accordingly, they continue their attempts to enforce outdated rules. Still, they are unlikely to win in the long run.
The new law will upset crypto money investors
There is information about a new bill called the Crypto Asset National Security Enhancement Act, which was recently drafted by the US Senate. This 2023 bill outlines proposed regulations for decentralized finance (DeFi) protocols. It also urges its users to abide by bank-like rules.
The bill states that these rules are crucial for tackling cryptocurrency-related crimes. Also, there are highlights for the prevention of money laundering. Moreover, in the United States there are also emphases on ensuring national security. It aims to impose various obligations on applications that control or use DeFi protocols.
new rules
According to the draft law, it is stated what will happen if a DeFi protocol is not controlled by any organization. Accordingly, there is a significant development for those who have invested more than $ 25 million in its development. It will be held responsible for fulfilling these obligations. These obligations are similar to those applied to traditional banks. It also covers activities such as collecting customer information, implementing know-your-customer and anti-money laundering protocols, reporting suspicious transactions and preventing sanctioned persons from using the protocol.
As a result, users of decentralized protocols will need to undergo authentication to comply with the requirements of the bill. Senator Jack Reed, a member of the Senate Banking Committee, presented this bill today. He also signaled that the Senate recognizes the need to regulate DeFi platforms in a similar way to traditional banking institutions.
Balance between
By introducing this bill, the US Senate recognizes the importance of striking a balance between promoting innovation and protecting the interests of national security and financial integrity. The cryptocurrency industry is maturing. Accordingly, establishing a comprehensive legal framework is essential for investors, businesses and individuals. On the other hand, it will be very important in creating a stable environment.
New steps will come as the Crypto Asset National Security Enhancement Act progresses through the legislative process. Accordingly, the crypto community awaits further developments and results for the future of DeFi and the wider crypto ecosystem.
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