WASHINGTON – A bipartisan infrastructure bill that was passed by the Senate earlier this month contains measures meant to help deliver what many officials see as much-needed regulation for the booming industry of the cryptocurrency.
But some industry and national security officials warn that the proposal could unintentionally push illicit cryptocurrency transactions into markets where the U.S. government has no reach, adding to the threat to businesses, government agencies. and American individuals.
The bill’s provision requires anyone handling cryptocurrency transactions to report the gross proceeds to the Internal Revenue Service, along with the names and addresses of the parties. It is intended to capture billions of dollars in tax revenue that the IRS says is lost every year and would also give law enforcement and regulators visibility in a market in which bad actors can all too easily operate. anonymously.
Few people dispute the need to disclose cryptocurrency transactions as a means of monitoring potentially illicit activity. But the bill as drafted captures corners of the industry that do not focus on transactions, including everything from miners and stakes to producers of hardware and software used in crypto markets. .
Thus, some intelligence and law enforcement officials are joining industry leaders in warning policymakers against overly aggressive regulations that risk exacerbating dangers to national security.