• A group of bipartisan lawmakers have proposed a new bill, the Crypto-Asset National Security Enhancement and Enforcement (CANSEE) Act, to regulate the decentralized finance (DeFi) industry.
• The bill has received criticism from the crypto community due to its impractical requirements and potential for supporting malicious actors like North Korea’s Lazarus group.
• The CANSEE Act seeks to ensure that DeFi complies with anti-money laundering (AML) rules and sanctions regulations, placing responsibility on investors for compliance when ownership of protocols is unclear.
New U.S. Senate Bill Targets Bringing DeFi into Compliance
A bipartisan group of lawmakers in the United States has proposed new rules to bring the decentralized finance (DeFi) sector under compliance by regulating DeFi protocols and platforms that provide access to these protocols, such as decentralized exchanges and wallet providers. The proposed Crypto-Asset National Security Enhancement and Enforcement (CANSEE) Act seeks to ensure that DeFi complies with anti-money laundering (AML) rules and sanctions regulations.
Potential Impact on DeFi Community
The CANSEE Act has received significant backlash from the crypto community due to its impractical requirements as well as its potential for supporting malicious actors like North Korea’s Lazarus group. Furthermore, when it is not clear who controls a protocol, anyone who invests more than $25 million in developing the project will be responsible for these obligations according to this bill.
Bill Bears Similarities to Previous Efforts
The proposed bill bears similarities to a previous effort from Senator Elizabeth Warren which was met with opposition from crypto enthusiasts at the time due to its restrictive nature. Regulations have become a hot topic in crypto in recent years as governments around the world seek ways to reign in this rapidly growing industry while maintaining investor protection laws, upholding international laws, and fostering innovation all at once.
Straddling Between Investor Protection & Innovation
Enacting crypto regulations is no easy feat as it requires finding a balance between investor protection, international law adherence, and innovation within this space; something many governments are still struggling with today. From countrywide bans on cryptocurrency trading platforms like China’s blanket ban on ICOs back in 2017 up until now where countries such as India are reportedly planning their own cryptocurrency ban – regulation surrounding cryptocurrencies remains an evergreen issue facing governments worldwide today.
Conclusion
As lawmakers continue their efforts towards enacting proper regulations surrounding cryptocurrencies worldwide while taking into account investor protection measures meant to deter malicious actors; only time will tell whether or not legislation such as CANSEE will pass or be met with another outcry of disapproval from those within the blockchain space – just like Senator Warren’s proposal before it was met with last year