A new law gives the US president the power to block access to digital assets.
The new bill gives the US president sweeping powers to block access to digital assets, sparking significant concerns from critics about X.
Scott Johnsson, a prominent digital asset advocate, criticized the law’s broad scope on June 6, saying:
“It is difficult to see whether the President intends to grant a ban at the user level for protocols/smart contracts that the Secretary of the Treasury deems “controlled, operated, or (available) for” by foreign sanctions. violator. “There is incredible scope and impact in bringing users onto the KYC/permissioned chain.”
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Senator Warner’s Legislative Activities
User
The new law broadly defines “digital assets” to include digital representations of value recorded on a cryptographically protected distributed ledger.
“(…) any communication protocol, smart contract or other software deployed using a distributed ledger or similar technology (…) and (…) allows users to interact and agree to the terms of trading digital assets; “It provides a mechanism.”
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The ‘Biden’ era
The new law allows the president to block transactions between Americans and foreign entities found to support terrorist organizations.
This includes imposing strict conditions on foreign financial institutions maintaining accounts in the United States if they are found to be facilitating such transactions.
“(…) Prohibits transactions between persons subject to U.S. jurisdiction and foreign digital asset transaction facilitators identified under paragraph (1).”
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Impact on Digital Asset Users
According to Johnsson’s analysis, the law’s broad applicability could require users to comply with Know Your Customer (KYC) and join permissioned blockchain networks, ultimately limiting them to regulated blockchains.
He warned that the move could be seen as an effort to exert control over digital assets under the guise of fighting terrorism.
The elements that Warner argues enable presidential powers are borrowed from the Terrorist Financing Act.
The bill was introduced in a December 2023 announcement and would allow the U.S. Treasury Department to track “emerging threats related to digital assets.”
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