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Crypto Confusion Leads to Legislative Action: Multiple Bills Introduced to Clarify Federal Regulation of Cryptocurrencies

Cryptocurrencies have often been associated with illegal activities due to the fact that they allow users to remain relatively anonymous. This anonymity is possible because, when transacting with Bitcoin and other cryptocurrencies, you can see where funds are being sent but not who sent or received them. However, there are signs that the use of crypto for unlawful purposes may be falling with illicit activity accounting for just 0.34% of all crypto transactions last year – down from roughly 2% a year earlier. Despite this improvement, cryptocurrency regulation appears to remain a top priority for federal lawmakers. One such example of this is the proposal of an anti-money laundering rule which would require people who hold their cryptocurrency in a private digital wallet to undergo identity checks if they make transactions of $3,000 or more. But Congress does not appear to be stopping there. As cryptocurrencies surged in value in recent days, lawmakers jumped to introduce two new bills aimed at advancing regulation of these precarious digital assets.