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Senate Cryptocurrency and Blockchain Hearing Set for July 30

THE COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS will meet in OPEN SESSION to conduct a hearing entitled “Examining Regulatory Frameworks for Digital Currencies and Blockchain.” 

The witnesses will be: Mr. Jeremy Allaire, Co-Founder, Chairman and Chief Executive Officer, Circle, on behalf of The Blockchain Association; Ms. Rebecca M. Nelson, Specialist in International Trade and Finance, Congressional Research Service; and Ms. Mehrsa Baradaran, Professor of Law, University of California, Irvine School of Law.

 Dr. Tom Robinson co-founder and Chief Scientist at Elliptic commented;

“The House and Senate hearings last week confirmed that the Treasury Department’s concerns around money laundering and terrorist financing are right at the top of regulators’ priority list when it comes to cryptocurrencies. This is actually bullish news for the future of cryptocurrencies long term. The US has had a clear AML regulatory framework around cryptocurrencies for several years now, while the rest of the world, led by the Financial Action Task Force (FATF), is rapidly adopting AML regulation focused on maintaining oversight of cryptocurrency service providers. 

This is actually bullish news for the future of cryptocurrencies long term.

Libra by design, is open in order to achieve its goal of serving the world’s unbanked. As such two design choices have been made with Libra that will greatly reduce the risk of misuse by bad actors. Firstly, like bitcoin or ethereum, Libra is based on a transparent transaction ledger.  Secondly, Libra transactions will be processed by “validators”, which are businesses such as Mastercard and Uber. Libra transactions will only be processed if a quorum of the validators agree to do so. 

Determining whether bitcoin, Libra or any other cryptocurrency transactions are connected to illicit activity is important for businesses and financial institutions that are handling digital assets.  In fact, under regulatory obligations, these companies have the obligation to understand the source of funds in their customers’ transactions, whether these are legitimate or from criminal activity. Today,  blockchain analytics software allows companies to screen transactions, detect risk, and uncover crypto enabled crime, including money laundering, terrorist fundraising, fraud and other financial crime including ransomware or dark markets.” 

 

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