Texas Congressman Calls for AML/KYC Regulations for Digital Currencies
According to a recently published congressional record , Texas Congressman Roger Williams recently called for Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations to be applied to digital currencies in order to help deter those who wish to do harm, namely terrorists and criminals.
The comments come as an accompaniment to a July 8 hearing in the House of Representatives, titled “Virtual Currency: Financial Innovation and National Security Implications ”, and in them, Congressman Williams starts by acknowledging the potential of digital currencies, stating:
This new financial platform is recreating the structures of international finance, and in part offers many exciting opportunities for our future.
Williams then goes on to talk about how digital currencies and their use within the U.S. territory shouldn’t help those who wish to do harm. Therefore, unless “rational and balanced” policies are developed to stop terrorists and criminals from using them, bad actors may be enabled by this new technology, the record reads.
The Texas Congressman particularly focuses on AML/KYC compliance demanded from other financial institutions that digital currencies aren’t yet compliant with. The lack of compliance may then allow the “forces of evil to finance their terrible endeavors.” The Congressman added:
Some in the digital currency world argue that digital finance requires a relaxation of these standards. This is absolutely incorrect.
Nevertheless, Williams calls for these regulations to protect innocent citizens against bad actors, without harming freedoms or economic opportunities. Summing up his argument, Williams encouraged Congress to further study digital currencies, while focusing on AML/KYC compliance. He stated:
…I am hopeful that, in the coming weeks, our focus will attend to the issue of AML/KYC compliance, highlighting those currencies that refuse to provide this safeguard, and examining and encouraging those who do.
Criminals Rarely Use Digital Currencies
As reported by CCN.com, a 2016 Europol report found that there was no evidence of terrorists using bitcoin. Moreover, a report from the European Commission to the European Parliament and Council found that the risk of digital currencies being used to finance terrorism is “moderately significant”, even though cases in which this was attempted have been reported.
The above-mentioned reports notably imply that, right now, terrorists and criminals aren’t smart enough to properly use digital currencies to their advantage. Nevertheless, they do add that the lack of regulations pose a threat of them being misused.
These conclude that the implementation of appropriate Anti-Money Laundering (AML) and CTF (Counter-Terrorist Finance) legal framework will help mitigate the risk. Essentially, both the European Commission and Congressman Roger Williams are on the same page when calling for regulations and AML/KYC compliance to stop bad actors from using virtual currencies to fund their campaigns, despite their apparent lack of interest in them so far.
Nonetheless, as notable bitcoin advocate Andreas Antonopoulos previously pointed out, we live in a world where criminals use technology, and it cannot be banned or controlled to stop them from doing so.
Featured image from Shutterstock.
