U.S. Senator Elizabeth Warren has proposed legislation targeting Russian crypto use that could ultimately require more action from exchanges. Some in the industry say that while the implications of the bill’s language are worrying, it’s too early to sound the alarm.
Warren introduced the Enhanced Digital Asset Sanctions Compliance Act at a Senate Banking Committee hearing on March 17. It proposes to further empower the Treasury Department to ban crypto service providers from trading with all Russia-linked addresses, and sanction anyone found to have materially assisting or supporting the sanctioned.
The broad language used in these sections could lead to penalties for many unexpected service providers if the government were to take advantage of these expanded powers. The Act adopts a broad definition of “digital asset transaction facilitator,” which is defined as any individual or group that significantly facilitates the purchase, sale, lending, borrowing, exchanging, custody, holding, verification, or creation of digital assets on behalf of others , including any communication protocols, decentralized financial technologies, smart contracts or other software, including open source computer code.
