• A bipartisan bill titled the Crypto-Asset National Security Enhancement (CANSEE) Act has been introduced in the US Senate that seeks to regulate decentralized finance (DeFi).
• Coin Center, a crypto advocacy group, criticized the bill and called it „messy, arbitrary, and unconstitutional“ due to its potential violation of the First Amendment.
• The CANSEE Act aims to tackle money laundering violations in DeFi but legal experts remain skeptical about its effectiveness.
CANSEE Act: An Attempt to Regulate DeFi Sector
The Crypto-Asset National Security Enhancement (CANSEE) Act is a bipartisan legislation introduced earlier this week by Senators Reed, Rounds, Warner and Romney which seeks to regulate decentralized finance (DeFi) sector. The main aim of this bill is to tackle money laundering violations in DeFi.
Coin Center’s Objection
Cypto advocacy group Coin Center has voiced objection to the bill arguing that such an approach would stifle innovation in the United States. Jerry Brito, CEO of Coin Center, lashed out at the bill and called it a messy, arbitrary, and unconstitutional approach to DeFi. He stated that if passed into law, it would extend penalties to anyone who develops or engages with such protocols. He further added that this would be “unconstitutional legislation as it would clearly violate the First Amendment”.
Legal Experts Remain Skeptical
Legal experts have remained skeptical about CANSEE act’s effectiveness as they fear that its implementation could cause more harm than good for the DeFi space. Some have argued that instead of attempting heavy regulation through laws like CANSEE act; lawmakers should focus on providing clearer guidance so people can make informed decisions about their involvement in projects related to cryptocurrencies and blockchain technology without fear of penalty or prosecution from authorities.
Industry Stakeholders Not Consulted
Brito also pointed out that industry stakeholders were not consulted before introducing such a major piece of legislation which can have far reaching implications for all those involved in cryptocurrency projects within the US borders. It appears as though lawmakers are not taking enough effort to understand how exactly this technology works before implementing regulations which could hamper growth within this nascent industry rather than promoting it further.
Conclusion
In conclusion, while there are clear attempts by lawmakers to clamp down on nefarious activities using cryptocurrencies like money laundering through bills like CANSEE act; legal experts remain divided over its actual effectivity due lack of consultation with industry stakeholders regarding such initiatives taken up by legislators.