• A recent measure suggests giving the Secret Service more power to tackle crypto crime.

• Encouraging innovation while maintaining an efficient regulatory framework is essential for the bitcoin market.

• Involving interested parties in the legislative process guarantees a thorough approach to regulation.

More vital threat assessments are needed to catch “seedy financial enterprises” facilitating money laundering schemes,” U.S. Senator Charles Grassley said. Two United States Senators have introduced a bill to expand the Secret Service’s powers to combat cryptocurrency-related crime.

The “Combatting Money Laundering in Cyber Crime Act of 2024” bill was introduced by Nevada’s Catherine Cortez Masto and Iowa’s Charles Grassley on Aug. 2. It would expand the Secret Service’s authority to investigate cryptocurrency transactions made by unlicensed money-transmitting businesses and potential frauds committed against U.S. financial institutions.

Bill Proposes to Give Secret Service More Power to Pursue Crypto Crime

“The funding of criminal activity through digital assets poses a direct threat to the security and safety of our nation,” Cortez Masto said, stressing the bill’s importance. “This bipartisan and bicameral bill will allow the U.S. Secret Service to investigate better new forms of financial crime involving digital assets.”

Grassley said more robust threat assessments are needed to catch “seedy financial enterprises” facilitating money laundering schemes. “Putting financial activity on federal law enforcement’s radar like this bill will improve our capacity to anticipate and prevent crimes.“

Illicit addresses laundered $22.2 billion worth of cryptocurrencies in 2023, according to blockchain forensics firm Chainalysis. While significant, it amounted to a nearly 30% fall from $31.5 billion in 2022. However, in February, the U.S. Treasury highlighted that cash — not cryptocurrency — remains the primary money laundering method for criminals in the U.S.

Also, Read: Crypto Criminals Capitalize on Ether Dip Using Stolen Nomad Assets.

That said, the U.S. Treasury, Department of Justice, Securities and Exchange Commission and Commodity Futures Trading Commission have also taken action to stop cryptocurrency crime in recent years.

Expanding Secret Service Authority in Digital Assets Investigation

The Secret Service is primarily tasked with protecting the U.S. president, vice president and other people of political importance, as well as conducting investigations into crimes against the financial infrastructure of the U.S.

Its competence was put under the spotlight in July when it failed to prevent an assassination attempt on Republican candidate Donald Trump. Meanwhile, the U.S. House passed the Financial Technology Protection Act on July 23 to avoid illicit cryptocurrency activities while safeguarding consumer choice.

This new bill would expand the Secret Service’s authority to investigate cryptocurrency transactions made by unlicensed money-transmitting businesses and potential frauds committed against U.S. financial institutions.

“The funding of criminal activity through digital assets directly threatens our nation’s security and safety,” Cortez Masto said, stressing the bill’s importance. “This bipartisan and bicameral bill will allow the U.S. Secret Service to investigate better new forms of financial crime involving digital assets.“

Addressing Cryptocurrency Fraud Investigations

Grassley said more substantial threat assessments are needed to catch “seedy financial enterprises” facilitating money laundering schemes. “Putting financial activity on federal law enforcement’s radar like this bill will improve our capacity to anticipate and prevent crimes.”

Illicit addresses laundered $22.2 billion worth of cryptocurrencies in 2023, according to blockchain forensics firm Chainalysis. While significant, it amounted to a nearly 30% fall from $31.5 billion in 2022. However, in February, the U.S. Treasury highlighted that cash — not cryptocurrency — remains the primary money laundering method for criminals in the U.S.

Also, Read August Token Unlocks: XRP, AVAX, and More Worth $1.5B.

That said, the U.S. Treasury, Department of Justice, Securities and Exchange Commission and Commodity Futures Trading Commission have also taken action to stop cryptocurrency crime in recent years.

Balancing Regulation and Innovation

As legislation around cryptocurrency evolves, a crucial challenge lies in balancing effective regulation with the need for innovation in the financial technology space. Senator Cortez Masto emphasized the importance of creating a regulatory framework that curtails illicit activities and fosters an environment where legitimate cryptocurrency businesses can thrive. “Our goal is to ensure user protection while promoting technological advancement,” she stated, highlighting the dual objectives of the proposed bill.

The growth of cryptocurrencies and blockchain technology presents a unique opportunity for economic development, and lawmakers are tasked with finding a middle ground that safeguards public interest without obstructing progress.

As discussions around this bill unfold, policymakers must engage with stakeholders, including businesses and consumer advocates, to shape a comprehensive approach that addresses security concerns and innovation potential within the rapidly evolving digital landscape.

Engaging Stakeholders in the Legislative Process

To achieve a balance between regulation and innovation, it is crucial for lawmakers to effectively engage a diverse range of stakeholders throughout the legislative process.

Collaboration with industry experts, technology innovators, financial institutions, and consumer advocacy groups will provide invaluable insights into the complexities of cryptocurrency and its associated risks. This inclusive approach ensures that the regulatory framework developed addresses potential vulnerabilities and encourages responsible growth within the sector.

Senator Grassley acknowledged the importance of public dialogue, stating, “We must listen to the voices of those affected by these regulations to craft effective solutions that serve both public safety and economic opportunity.” By fostering an ongoing conversation with stakeholders, legislators can strive to create a robust framework that both curbs illicit activities and nurtures the burgeoning field of digital assets.