US Senator Warren’s Anti-Cryptocurrency Bill That Could Affect the Industry Suffered a Big Setback

Senator Elizabeth Warren's campaign against the cryptocurrency industry suffered a significant setback at the House Financial Services Committee's oversight hearing this week.

Warren has been vocal in her criticism of the crypto industry, arguing that it serves as a primary vehicle for criminal activity. However, his stance was met with opposition from some Senate colleagues.

Brian Nelson, Treasury Undersecretary for Terrorism and Financial Intelligence, denied Warren's claims that cryptocurrencies are primarily responsible for financing terrorist organizations in the Middle East. After Nelson's statement, those inside the crypto industry could not hide their surprise.

“Frankly, we assessed that terrorists still prefer to use traditional products and services,” Nelson said during a meeting with House Majority Representative Tom Emmer. Nelson's comments counter the prevailing media narrative and Warren's argument for legislation that could potentially hinder the future of crypto in the US.

Emmer kicked off the conversation by asking Nelson about data reported by The Wall Street Journal in October. The report claimed that terrorist groups received over $100 million in cryptocurrency payments between August 2021 and June 2023.

However, the Journal published a correction two weeks later, reducing the figure to just $12 million. Nelson confirmed that terrorist groups are using crypto, but the amounts are relatively small compared to what was initially reported.

The inflated figures in the original Journal article increased Warren's hostility towards the crypto industry. Those numbers had also prompted Warren to push for the bipartisan Digital Asset Anti-Money Laundering Act, which 19 other senators agreed to co-sponsor.

Warren's bill would require all crypto industry participants, including miners, network validators, and decentralized wallet providers, to comply with “know your customer” (KYC) rules. These rules were originally created to prevent money laundering in banks.

*This is not investment advice.