The recent attack in southern Israel, which reportedly resulted in the deaths of 1,200 Israelis, has brought attention to the role of cryptocurrency in funding such acts. This revelation has fueled the efforts of Senator Elizabeth Warren and others advocating for crypto legislation. The proposed bill, facing opposition from the Chamber of Digital Commerce, aims to expand anti-money laundering requirements to include digital asset wallet providers, crypto miners, validators, and other network participants.
Opposition and Support for the Bill
While Senator Warren’s bill initially faced opposition concerning innovation and market security, the involvement of Hamas in the attack has strengthened her argument. Jaret Seiberg, an analyst at TD Cowen, stated, “We believe this materially improves prospects for the Digital Asset Anti-Money Laundering Act of 2023 as it makes it politically difficult for any lawmaker to stand in the way of tougher AML/BSA for crypto.”
Although the legislation was introduced in July, it has yet to make significant progress toward committee approval. However, Senator Warren has seized on the Hamas news to emphasize the urgency of her proposed measures. She took to X (formerly Twitter) to express her concerns that “digital wallets connected to Hamas received millions of dollars in cryptocurrencies” and the need to equip law enforcement agencies with the necessary powers to combat crypto-financed crimes.
Co-Sponsors and Challenges Ahead
The bill was co-sponsored by Senator Joe Manchin (D-W.V.), known for his centrist position, as well as Republican Senators Roger Marshall (R-Kan.) and Lindsey Graham (R-S.C.). Senator Warren received additional support from Senator Dick Durbin (D-Ill.), Chairman of the Judiciary Committee, and Senator Gary Peters (D-Mich.), who leads the Homeland Security panel.
Despite influential supporters, the bill’s passage faces challenges in the current Congress, with each party controlling one chamber, the House of Representatives lacking a speaker, and government funding set to expire on November 17. However, some of Warren’s concerns regarding money laundering have also been addressed in a proposed amendment to the 2024 National Defense Authorization Act (NDAA).
