A new bill has been presented in the House of Representatives in the United States that aims to ban cryptocurrency mixers for a period of two years. The bill, known as the Blockchain Integrity Act, is being championed by five Democratic congresspeople, with Sean Casten leading the charge.
In a statement, Casten defined a crypto mixer as a platform that enables users to create a new address and withdraw their funds without revealing the connection between the depositor and withdrawal addresses.
The proposed legislation would temporarily prevent financial institutions, including cryptocurrency exchanges, virtual asset service providers, and registered money service businesses, from accepting funds that have been through a mixer, or allowing funds to be withdrawn directly to a mixer address. Any violation of the ban would result in a civil penalty of up to $100,000.
During the two-year ban, the Treasury Department would produce a comprehensive report that includes various details. This report would cover the estimated percentage of mixer transactions involving illicit finance, the legitimate uses of mixers, law enforcement’s ability to track and prevent such transactions, and the regulatory approaches to mixers taken in other jurisdictions.
Co-sponsoring the bill alongside Casten are Representatives Bill Foster, Brad Sherman, and Emanuel Cleaver. The bill has yet to be sent to committee. Sherman, who has a history of opposing cryptocurrencies, was quoted by Casten as saying:
“The United States has previously taken action against crypto mixers. In August 2022, the Treasury’s Office of Foreign Asset Control added addresses associated with the mixer Tornado Cash to its list of Specially Designated Nationals, effectively prohibiting U.S. citizens from using it. This decision was successfully defended in court a year later. The founders of Tornado Cash have been charged with money laundering, sanctions violations, and other related crimes in the U.S. and the Netherlands.”
In addition to this bill, privacy-focused cryptocurrency Monero (XMR) has faced scrutiny after the European Union introduced new Anti-Money Laundering laws. The pressure on privacy coins and mixers continues to grow.
Article Source: [casten.house.gov](casten.house.gov)
Magazine Source: Tornado Cash 2.0: The race to build safe and legal coin mixers