US Defense Bill Excludes Crypto Measures, Legislators Eye Future Regulation

The U.S. Congress has finalized the National Defense Authorization Act (NDAA) for the upcoming year, which secures funding for the nation’s defense operations. Notably absent in this year’s bill are any provisions related to cryptocurrency or blockchain technology, according to statements made by Cody Carbone, the Vice President of Policy at the Chamber of Digital Commerce.

The NDAA, which was released on Wednesday night, typically includes a wide range of national security measures. However, this year’s omission of cryptocurrency regulations indicates that any legislative action on this front will be deferred to the following year.

The bill notably left out a proposed amendment that had garnered bipartisan support. This amendment, put forward by Senators Cynthia Lummis, Kirsten Gillibrand, Roger Marshall, and Elizabeth Warren, aimed to establish examination standards for financial institutions involved in cryptocurrency. Furthermore, it would have obligated the Treasury Department to provide Congress with recommendations regarding the regulation of crypto mixers, which can obscure the traceability of cryptocurrency transactions.

Another proposed provision, which sought to institute an independent working group to address terrorism and illicit financing, was also excluded from the NDAA. This initiative had been introduced in April by Senators Ted Budd and Kirsten Gillibrand.

The absence of these measures from the NDAA has sparked disappointment among advocates for digital asset regulation. Carbone expressed dissatisfaction with the outcome, labeling it as a missed opportunity for bipartisan and sensible legislation in the digital asset and blockchain domain.

Echoing this sentiment, Senator Lummis voiced her dismay at the exclusion of her provision targeting illicit finance. She emphasized the urgent need for Congress to enact substantive legislation on digital assets, underscoring the importance of robust consumer protections and a well-regulated, safe cryptocurrency market in the United States.

Senator Lummis remains committed to advancing legislation in the cryptocurrency space. She reiterated her intentions to continue working with Senator Gillibrand on their collaborative bill to effectively regulate the crypto sector.