According to a statement from the bill’s sponsors, introduced on behalf of a bipartisan group of senators, the new law aims to combat money laundering and sanctions evasion by taking advantage of the benefits offered by decentralized finance platforms.
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“This law strengthens the Treasury Department’s tools to protect our national and economic security. Drug cartels, sex traffickers and the like should not be able to use DeFi platforms to escape justice,” explains Banking Committee member Senator Jack Reed.
The bill holds those who control DeFi projects personally liable. State regulators, if the law is approved, would be authorized to impose sanctions, similar to how existing traditional financial firms or casinos are liable for failing to stop money laundering. If no one formally controls the DeFi project, then “anyone who invests more than $25 million in the platform to develop the project will be liable.”
European officials announced
work on an updated set of rules for crypto regulation in the European Union MiCA-2. Analysts point to DeFi projects as the next target of regulators.