U.S. House Passes Crypto Illicit Finance Bill That’s Likely to be Rebuffed in Senate

A narrowly-scoped bill establishing a U.S. working group to investigate the use of crypto in terrorism and money laundering has passed a routine vote in the U.S. House of Representatives.

The bill is unlikely to advance further without approval from the Senate, but it would mean another Congressional approval of cryptocurrency legislation.

As Congress considers this latest cryptocurrency bill, industry representatives reached out to Vice President Kamala Harris on Monday to encourage her to embrace cryptocurrency as a presidential candidate.

The U.S. House of Representatives has approved another cryptocurrency-related bill in a routine vote, but the bill, which would establish a government working group to assess how to prevent malicious actors from using digital assets, is unlikely to become law in its current form.

The short bill, introduced by Representative Zach Nunn (R-Iowa), was among the crypto provisions that had previously passed the House Financial Services Committee; however, despite bipartisan progress on industry-friendly legislation in the House (such as the Financial Innovation and Technology for the 21st Century Act (FIT21)), the Senate has yet to match the House’s crypto adoption.

Nunn’s effort, which was unanimously approved by the committee last year, would have established an interim working group under the Treasury Department to investigate the use of digital assets in terrorism and money laundering and make recommendations on how to combat it. The group would have included industry insiders, including members from “blockchain intelligence firms.”

Nunn called the bill “vital to strengthening America’s national security, protecting our digital assets, and ensuring the next generation of financial and internet technology is built in America,” during his speech on the House floor.

TD Cowen analyst Jaret Seiberg suggested that this bill is essentially a political exercise.

“For crypto critics, this is a way to register their demands to combat money laundering,” he said in a client note on Monday. “And for crypto advocates, it gives them political cover against attacks that their support for digital assets facilitates money laundering and criminal activity.”

While crypto has established itself as a major political issue in the 2024 presidential race, the odds of a narrowly divided Congress reaching an agreement on a long-awaited regulatory approach to the industry remain slim. To that end, crypto insiders are keeping a close eye on several relevant provisions being considered for the National Defense Authorization Act, the annual bill that outlines the nation’s defense priorities.

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Also on Monday, the Digital Chamber sent a letter to Vice President Kamala Harris — currently being positioned by the party as the leading candidate to replace President Joe Biden as the Democratic presidential nominee. The letter called for Harris to “take a forward-thinking approach to digital assets and blockchain technology,” which meant adding a positive crypto position to the party’s official platform and selecting a running mate who “has a proven track record of engaging with digital asset technology and proposing innovative policies.”

The letter also included comments from other prominent industry participants who similarly called for the potential Democratic leader to adopt a friendlier approach to crypto.

Read More: US House Approves Crypto FIT21 Bill on Wave of Democrat Support

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