Bitcoin proponents have reacted angrily to what they warn is a fresh attempt to make US Congress ban public cryptocurrencies.
Murray: US Should Treat Miners Like Banks
As financial news outlet Business Telegraph reported, on September 3, an expert witness went before lawmakers to argue miners on blockchains such as Bitcoin’s should face full banking-style regulation.
David Murray, vice president for product development and services at Financial Integrity Network, referred to miners as “virtual asset transaction validators.”
“At minimum, virtual asset transaction validators should be required to govern participation in their validation systems, with well-designed programs for vetting the issuers, exchangers, and custodians that they serve,” he testified.
Murray was speaking within the context of a debate which aimed to address international human trafficking.
He singled out Bitcoin in particular as part of a financial phenomena group which allegedly exacerbate the problem. These, he said, should fall under the jurisdiction of the Bank Secrecy Act.
A Bitcoin Ban ‘Couched As Regulating’
The idea of making miners identify network participants is impossible, critics said, as Bitcoin’s blockchain by design makes reliance on a centralized validator redundant.
Peter Van Valkenburgh, Director of Research at Coin Center, argued Murray was simply trying to ban the ‘unbannable.’
“It’s couched as regulating but what it would be is an effective ban on American persons or businesses using open blockchain networks because it would require them to use it on a permissioned basis,” he told CoinDesk following Murray’s testimony.
In a report for Coin Center in March, Van Valkenburgh took on the idea of applying the Bank Secrecy Act.
“Regulating cryptocurrency software developers and individual users of that software under the Bank Secrecy Act would be unconstitutional under the Fourth Amendment because it would be a warrantless search and seizure of information private to cryptocurrency users,” he summarized.
Echoes of the FATF
As Bitcoinist reported, efforts to force identity requirements on decentralized networks have already met with disbelief this year. In June, intergovernmental body the Financial Action Task Force (FATF) recommended member states do so for parties involved in cryptocurrency transactions worth over $ 1000.
The idea, which over 200 countries should technically implement, sparked an immediate backlash. Authorities, sources said, still could not understand that a cryptocurrency transaction was not like a banking one.
“The people trying to understand Bitcoin are not consulting with anyone who actually understands it and who can put it into a proper context,” Akin Fernandez, CEO of Bitcoin onboarding service Azteco, stated at the time.
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