The 2024 Defense Act touches on several crypto-related topics.
In an epoch-making development, the US Senate ratified the National Defense Authorization Act (NDAA) 2024, which proposes an expenditure of $886 billion.
A striking part of this legislative document is its focus on cryptocurrency mixers, anonymous coins, and institutions partaking in crypto commerce.
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The NDAA is legislation dictating how the Department of Defense can employ federal resources. The current version of the Act carries several amendments related to cryptocurrencies.
The amendment draws from the Digital Asset Anti-Money Laundering Act introduced in 2022 and the Responsible Financial Innovation Act, targeted at preventing incidents similar to the FTX crisis.
The new amendment calls for evaluative protocols for cryptocurrencies to establish risks and verify compliance with related sanctions and money laundering statutes.
Moreover, the Treasury Department is instructed to initiate a research effort to thwart anonymous crypto transactions, putting the spotlight on cryptocurrency mixers such as Tornado Cash, which enable private transactions.
In 2022, the crypto mixer Tornado Cash came under the purview of US Treasury Department sanctions, preventing American residents from using the platform. Though originally developed for anonymizing crypto transactions, it, unfortunately, became a tool to hide the source of their unlawfully gained crypto assets from hacks and other illicit activities.
The past few days were quite big for the crypto industry in the US. On July 26th, lawmakers approved the Blockchain Regulatory Certainty Act and the Financial Innovation and Technology for the 21st Century Act. On July 27th, the lawmakers passed the Clarity for Payment Stablecoins Act and the Keep Your Coins Act.
The ratification of the 2024 NDAA, containing comprehensive provisions about digital currencies, is a major milestone in the US's regulatory approach to cryptocurrencies. It highlights the government's intensifying efforts to demystify and regulate the complex world of cryptocurrencies, laying out a clear roadmap to manage potential risks while fostering innovation in this swiftly evolving sector.
