U.S. Senators introduce bipartisan bill to bust digital asset money laundering

U.S. Senators Elizabeth Warren (D-MA) and Roger Marshall (R-KS) unveiled a bipartisan legislation Tuesday that takes aim at money laundering as well as terrorist financing through digital assets. The Digital Asset Anti-Money Laundering Act would disallow financial institutions from transacting with digital asset mixers, which are services designed to conceal the origin of digital asset transactions. In addition, the bill would direct the Financial Crimes Enforcement Network to classify digital asset wallet providers, miners, validators, and other crypto participants as money service businesses. That, in turn, would bring Know-Your-Customer requirements to the crypto space. “Following the September 11, 2001 terrorist attacks, our government enacted meaningful reforms that helped the banks cut off bad actors’ from America’s financial system," Marshall said in a statement. "Applying these similar policies to cryptocurrency exchanges will prevent digital assets from being abused to finance illegal activities without limiting law-abiding American citizens’ access." The proposed legislation comes after the downfall of crypto exchange FTX ( FTT-USD ) and the subsequent criminal prosecution of its founder and ex-CEO, Sam Bankman-Fried, spurred increased regulatory scrutiny across the digital asset ecosystem. Earlier, FTX lawsuits shed light on how U.S. regulators can police overseas trading platforms . Dear readers: We recognize that politics often intersects with the financial news of the day, so we invite you to click here to click here to join the separate political discussion .