Senator Lummis: No need to add "DeFi provisions" to the CLARITY Act

BlockBeats News, May 14 — U.S. Senator Van Hollen and Cynthia Lummis spoke during the review of the CLARITY Act regarding an amendment that adds provisions about increasing DeFi money laundering risks and accountability.

Senator Van Hollen supported the amendment, stating, “We all know that bad actors use tools like tumblers and mixers to launder money, evade law enforcement, and transfer funds. Records show that Iran-related individuals have used mixing services and related technologies to transfer funds and evade sanctions. In some cases, it’s clear that the developers of these DeFi tools intended to profit from illegal activities from the start. They know that criminals will use these tools — in fact, for some of them, that’s the entire purpose of developing these tools. Therefore, we must hold them accountable. Addressing the overall illegal financial risks of DeFi is not simple, but this amendment is direct, limited, and straightforward. It does one thing: explicitly states that if the purpose of releasing a DeFi protocol is to facilitate money laundering, evade sanctions, or fund terrorism, then it is illegal. That’s all. If you intentionally facilitate drug traffickers, scammers, North Korea, or Iran, you should face consequences.”

Senator Cynthia Lummis opposed the amendment, stating, “Under Title 18 of the U.S. Code Sections 1956 and 1957 and related sanctions laws, if someone builds or uses software to launder criminal proceeds or evade sanctions, prosecutors can already bring charges under these laws — there’s no need to add a ‘DeFi provision’ in the bill. I only care about one thing: how specific behaviors are handled, but we shouldn’t send a signal that ‘software is unwelcome.’ We want to embed digital assets into the existing legal framework in the U.S., not start from scratch. Therefore, I oppose this amendment.”

The amendment was rejected with 11 votes in favor and 13 votes against. The ‘Cryptocurrency Market Structure Act’ (the CLARITY Act) is currently debating and voting on each amendment.