Governments are not in favor of Bitcoin and cryptocurrencies these days. They have never been, and it is highly unlikely they will ever be. The US Congress is introducing a new bill called “Combat Money Laundering, Terrorist Financing, and Counterfeiting Act 2017.” It touches upon many different subjects, including cryptocurrencies. The US government plans to seize consumers’ assets through a method referred to as “Civil Asset Forfeiture.”
Civil Asset Forfeiture Is Dangerous For Cryptocurrency
Any new bill proposed by the US Congress is a reason to be concerned. This is especially true when said bill has anything to do with censorship, privacy, or the financial situation. In this particular case, the new bill aims to address money laundering, terrorist financing, and counterfeiting. All of these issues need to be addressed in a severe way, which is understandable. The methods outlined in this bill, however, raise a lot of questions.
What has a lot of cryptocurrency enthusiasts concerned is the Civil Asset Forfeiture clause in this bill. This particular method would grant the US government to seize assets from civilians, regardless of their reasoning behind it. Some people may think something like this should be illegal, but we are talking about the government here. They are the ones making the laws, thus they can – in theory – do anything they want as long as there is enough support to back such a bill.
The main purpose of this new bill is to expand the list of offenses which result in legal seizure of civilian assets. All of these additions relate to terrorist financing and money laundering in one way or another. However, the definition of “financial crimes” in this bill leaves room for a fair amount of interpretation. It is evident this bill will undergo some amendments before it can even be approved, though, as the current iteration will cause a lot of confusion.
As is to be expected, this new bill makes a clear mention of digital currencies and “other similar instruments.” The US government wants to ensure people report their cryptocurrency holdings and any profits or losses stemming forth from this investment. Failure to comply with these guidelines can result in having your personal assets – including digital currencies – frozen and seized but the US government. Enforcing such a decision will be a lot easier when people keep funds in an exchange or online wallet, rather than a private wallet.
The bill does not just pertain to digital currencies, though. The US government wants to keep close tabs on people dealing with cash, gift cards, vouchers, prepaid cell phones, safety deposit boxes, and anything else that could be of value in one way or another. It seems anything below $10,000 is deemed acceptable, but anything surpassing this threshold is subject to Civil Asset Forfeiture. That is a very disturbing development, to say the least.
Rest assured this Civil Asset Forfeiture proposal will meet a fair bit of opposition, both within and outside of the US government. This bill is nothing more than a proposal right now, and it can be amended if needed. Now is a good time for all cryptocurrency enthusiasts to reach out to their congressmen and voice their concerns regarding this bill. It is evident proposals such as these will cause more harm than anything else if they are left untouched.
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