Hiding your currency holdings may result in penalties. This new US proposal is going to cause trouble.

Last week, on November 28, the U.S. bill S.1241 (Anti-Money Laundering and Terrorist Financing AML Modernization Act) was amended. During a U.S. Senate committee hearing, representatives supporting the bill proposed amending the important definition of “financial institution” in the statute.

S.1241

The bill S.1241 was formally submitted in June this year. The community believes that this bill greatly restricts the freedom of Bitcoin. Recently, members of the Judiciary Committee discussed the impact of digital currency on AML (anti-money laundering) and KYC (know your customer) regulatory rules. However, it is clear from the meeting minutes that the term "financial institution" has been given a broader definition.

The bill defines a financial institution not as a business model such as banks and credit unions, but as an “issuer, repayer, prepaid access device teller, digital currency, digital exchange or trading institution.”

During the hearing, Representative Feinstein explained that the bill makes it illegal to intentionally conceal ownership and control of a bank account, which includes digital currency or other similar “prepaid instruments.”

'Prepaid Access Device' means an electronic device or instrument such as a card, disk, code, number, electronic serial number, mobile identification number, personal identification number or the like that provides access to funds or funds of value that have been paid in advance and are recoverable and transferable at a later date.

Regulatory crossroads

Minnesota Senator Amy Klobuchar asked former U.S. Treasury agent John Cassara what he thought about the current "transfer from cash to digital cash." Klobuchar is interested in whether law enforcement can track money laundering related to cryptocurrencies. Cassara, who has worked on investigating money laundering, transaction fraud, international smuggling and other cases, said he was happy that he had not handled any cases related to digital currencies during his tenure.

I don't know how to track cryptocurrency funds, it's too challenging.

I think if you look at the indicators right now, cryptocurrencies are only a small part of the threats we face - that doesn't mean that will be the case in 5-10 years. We are at a crossroads right now, and it will be interesting to see what happens.

Bitcoin supporters will be watching the bill closely. The government's discussion of the bill may cause concern among privacy-conscious bitcoiners, especially since one lawmaker has suggested criminalizing people who intentionally conceal their digital currency holdings. As the bill has evolved, skeptics have noticed that many definitions have been changed and quietly inserted into the bill, just like in recent days, when U.S. lawmakers passed a bill that "quietly added $1 trillion to the country's fiscal deficit."