Bipartisan Senators Warn Crypto Bill Could Undermine Money Laundering Efforts
Bipartisan senators are sounding the alarm over a provision in Senator Tim Scott's crypto market structure bill that could weaken anti-money laundering enforcement. Senators Chuck Grassley and Dick Durbin argue Section 604's exemption for blockchain developers from financial licensing requirements may hinder prosecution of financial crimes.
The controversy stems from concerns that the provision could have shielded the founder of Tornado Cash, a crypto mixing service previously targeted by regulators. Law enforcement groups including the National Association of Assistant U.S. Attorneys warn the bill may limit tools to combat illicit finance.
Senator Scott's office maintains the provision protects software developers while preserving law enforcement capabilities. The debate highlights growing tensions between crypto innovation and regulatory oversight as digital assets gain mainstream traction.
