Regulation
The White House can now freeze your assets
Fri 07 June 2024 ▪ 4 minute read ▪ by Evans S.
A new US law gives the president unprecedented power to block access to cryptocurrencies. This legislative measure is causing significant concern due to its broad implications and potential impact on cryptocurrency users. With this law, the President of the United States can now exercise direct control over digital transactions.
Extended powers and implications
The new law gives the president broad powers to block access to digital assets. Scott Johnsson, an influential voice in the cryptocurrency field, has strongly criticized this legislation for its considerable reach.
According to him, this law could allow the president to ban access to anyone protocol or smart contract deemed noncompliant by the Secretary of the Treasury. The scope of this measure is surprising and could force users to turn to KYC (Know Your Customer) and authorized chains.
Johnsson expressed his concerns, pointing out that the law could trap users in regulated chains, thus limiting their freedom to use cryptocurrencies. “It’s hard to understand how this isn’t a presidential user-level ban power,” he said, underscoring the measure’s broad and potentially repressive implications.
Under this new law, the president can block transactions between American individuals and foreign entities identified as supporting terrorist organizations. He can also ban transactions via communication protocols, smart contracts or software involving cryptocurrencies. This could have profound consequences for cryptocurrency users.
Senator Warner’s Legislative Move
On June 5, an X user revealed Senator’s apparent strategic insertion of legislative items Marco Warner. These elements grant the president expanded new powers over digital assets.
Warner introduced this legislation in a December 2023 announcement, allowing the Treasury Department to address emerging threats involving digital assets.
The law broadly defines “digital assets,” including any digital representation of value recorded on cryptographically protected distributed ledgers. This includes communications protocols, smart contracts, or other software deployed using distributed ledger technology or similar. This broad definition gives the president a lot of leeway to intervene across various platforms and technologies.
In addition to blocking transactions, the president can impose strict conditions on foreign financial institutions that hold accounts in the United States. If these institutions facilitate crypto transactions with entities that support terrorist organizations, they could face severe sanctions. This measure aims to strengthen the control and surveillance of international financial flows.
Towards a regulated cryptocurrency?
Johnsson’s analysis suggests that the law’s broad applicability could force users to join KYC-compliant and permissioned blockchain networks. This development could limit users to regulated blockchains, thus reducing decentralization and autonomy, which are central to cryptocurrencies.
Johnsson warns that this measure could be perceived as an attempt to exert control over cryptocurrencies under the guise of fighting terrorism.
The elements added by Warner, borrowed from the Terrorist Financing Act, reinforce this perception.
The new law could radically transform the use of cryptocurrencies, making users more vulnerable to government surveillance and control.
While this measure aims to strengthen national security and fight terrorism, it also raises crucial questions about the freedom and autonomy of users. The future of cryptocurrencies with this new regulation remains uncertain and only an in-depth and ongoing analysis will fully reveal its implications.
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Evans S.
Fascinated by bitcoin since 2017, Evariste has not stopped researching on the topic. If his main interest is in trading, the sage is desperate to discover all the advanced centers on cryptocurrencies. As an editor, he aspires to consistently provide high-quality work that reflects the state of the industry as a whole.
DISCLAIMER
The views, thoughts and opinions expressed in this article are solely those of the author and should not be relied upon as investment advice. Do your research before making any investment decisions.