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[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 8266 Introduced in House (IH)]
<DOC>
118th CONGRESS
2d Session
H. R. 8266
To place a 2-year moratorium on financial institutions handling, using,
or transacting with funds routed through digital asset mixers and to
require the Secretary of the Treasury to carry out a study of digital
asset mixers, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
May 7, 2024
Mr. Casten (for himself, Mr. Foster, Mr. Sherman, and Mr. Cleaver)
introduced the following bill; which was referred to the Committee on
Financial Services
_______________________________________________________________________
A BILL
To place a 2-year moratorium on financial institutions handling, using,
or transacting with funds routed through digital asset mixers and to
require the Secretary of the Treasury to carry out a study of digital
asset mixers, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Blockchain Integrity Act''.
SEC. 2. MORATORIUM ON DIGITAL ASSET MIXERS.
(a) Moratorium.--
(1) In general.--During the 2-year period beginning 6
months after the date of enactment of this Act, it shall be
unlawful for a financial institution to handle, use, or
transact with--
(A) any incoming funds that have been routed
through a digital asset mixer operating on a
cryptographically secured distributed ledger; and
(B) any outgoing funds routed directly to a digital
asset mixer operating on a cryptographically secured
distributed ledger.
(2) Enforcement.--
(A) In general.--The Secretary of the Treasury
shall enforce this section.
(B) Civil penalty.--The Secretary of the Treasury
may impose a civil penalty on any financial institution
that violates subsection (a) in an amount not greater
than $100,000 for each violation.
(b) Study by Treasury.--The Secretary of the Treasury, in
consultation with the Securities and Exchange Commission, the Commodity
Futures Trading Commission, the Attorney General, and such other
departments and agencies as determined by the Secretary of the
Treasury, shall carry out a study of digital asset mixers, privacy
coins, and other anonymity-enhancing technologies.
(c) Report.--Not later than 18 months after the date of the
enactment of this Act, the Secretary of the Treasury shall provide to
the Committee on Financial Services of the House of Representatives and
the Committee on Banking, Housing, and Urban Affairs of the Senate a
report, to include a classified annex, if necessary, that contains all
findings made in carrying out the study under subsection (b) that
analyzes the following issues:
(1) Current typologies of digital asset mixers, privacy
coins, and other anonymity-enhancing technologies, and
historical transaction volume.
(2) Estimates of the percentage of transactions in
paragraph (1) that are believed to be connected, directly or
indirectly, to illicit finance, including digital asset
transaction volumes associated with sanctioned entities and
entities subject to special measures pursuant to section 5318A
of title 31, United States Code, and a description of any
limitations applicable to the data used in such estimates.
(3) Information about legitimate uses of digital asset
mixers, including transaction volumes associated with payments
to journalists in authoritarian regimes, donations to the
government of Ukraine, and for enhanced privacy and security
purposes.
(4) The capacity of the Financial Crimes Enforcement
Network, the Office of Foreign Assets Control, and Federal and
State law enforcement agencies to track, prevent the transfer
of, freeze, and confiscate funds that have been processed
through digital asset mixers, privacy coins, and other
anonymity-enhancing technologies, including--
(A) general estimates regarding the number of
instances on an annual basis such agencies were able to
prevent the transfer of funds through such methods; and
(B) the extent to which such agencies utilized
blockchain analytics firms when preventing the transfer
of funds through such methods.
(5) New and emerging obfuscation tools and methods to
reduce transparency on a cryptographically secured distributed
ledger.
(6) Financial incentives for relayers or any other party in
the process of validating transactions on a cryptographically
secured distributed ledger, including an assessment of the
contractual relationship between relayers and digital asset
mixers.
(7) Regulatory approaches employed by other jurisdictions
to address illicit uses of digital asset mixers, privacy coins,
and other anonymity-enhancing technologies.
(8) Recommendations for legislation or regulation to
address the illicit uses of digital assets, including with
respect to--
(A) covered nations, as defined in section
4872(d)(2) of title 10, United States Code, and
affiliated actors;
(B) Foreign Terrorist Organizations, as designated
by the Secretary of State, and affiliated actors;
(C) sanctions evasion by Russian entities,
individuals, and affiliated actors;
(D) human trafficking and the sexual exploitation
of children;
(E) international trafficking of fentanyl, fentanyl
precursors, or other related opioids;
(F) organized crime groups in East and Southeast
Asia; and
(G) darknet marketplaces.
(d) Definitions.--In this section:
(1) Anonymity-enhancing technologies.--The term
``anonymity-enhancing technologies'' means software, products,
or services that facilitate digital asset transactions with
enhanced anonymity, as defined by the Financial Crimes
Enforcement Network.
(2) Digital asset mixer.--The term ``digital asset mixer''
means a website, software, or other service designed to conceal
or obfuscate the origin, destination, and counterparties of
digital asset transactions.
(3) Financial institution.--The term ``financial
institution'' has the meaning given the term in section 5312(a)
of title 31, United States Code.
(4) Privacy coin.--The term ``privacy coin'' means a
digital asset designed to--
(A) hinder tracing through distributed ledgers; or
(B) conceal or obfuscate the origin, destination,
and counterparties of digital asset transactions.
(5) Relayers.--The term ``relayers'' means a person,
entity, software program, or person or entity operating such
software program, that receives, communicates, or otherwise
conveys blocks of transactions to a validator, miner, or other
entity that serves a similar function.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Financial Services.
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