Congress Considering Validating Bitcoin
Friday afternoon the value of “Bitcoin cash,” an offshoot of the digital currency Bitcoin, surged 40 percent to $655. As the volatile currency increases in value it also increases in interest in Washington, which has mostly ignored its rise in popularity. Three Members of Congress are working on legislation to protect certain digital currencies from government interference, The Daily Caller has learned.
Sources on the Hill told the D.C. said various members of Congress are looking at the compliant capabilities of AML Bitcoin, which is a compliant digital currency. Bitcoin is the most famous digital currency, or crypto-currency, and has skyrocket in value over the past few weeks. Business Insider reported this week that one Bitcoin is now valued at almost $4,400 and “Bitcoin has rallied over 300% since the start of 2017.”
Although very valuable, Bitcoin has been surrounded with controversy. The New York Post reported in August that a young British model was auctioned off on the dark web with an “ad set the opening bid at $353,000 in bitcoin” because the currency is untraceable.
Members of Congress are working on legislation that would provide protections to currencies if they meet certain minimum conditions on preventing the currencies from being used by terrorists, drug traffickers, and others engaged in unlawful business practices. The plan would bring digital currency out of the shadows and is expected to be met with support from libertarian leaning members of Congress and some opposition from Treasury officials who don’t want competition for the dollar.
Because discussions didn’t start until just before the August recess, legislation is in the process of being drafted and vetted during the Congressional vacation. The three offices looking at the issue asked not to be identified for this story because of the sensitivity of the issue and the complexity of the solution.
A source close to the effort informed TheDC that at least one Republican member of the Senate and two Republican members of the House are taking a hard look with the intention of pushing legislation this Fall.
A source close to the effort told TheDC, “the center piece of the plan is to mainstream digital currency so it can be treated just like the American dollar. First, there is a new entity that is considering issuing a brand new digital currency that is compliant with anti-money laundering laws unlike any other in circulation.”
Although cash has some of the same problems being used to pay for illegal activities, the perception that digital currencies are being used for illegal activities is seen as the primary roadblock to wholesale acceptance by the American public.
The source told TheDC the new model is going to follow federal laws that prevent money laundering. This is a break through and could lead to the use of digital currencies replacing the dollar for many transactions. The legislation is expected to be introduced in early September.
The source asked the members of Congress involved in drafting the bill not be identified yet, explaining, “this is a very complicated issue and staff are working through some issues that have in the past stopped alternative currencies from being launched.”
They continued that “the law needs to be changed to protect digital currencies from federal government harassment to make sure that a complaint currency can be backed by value, the currency cannot be treated like a security or investment, and that transfers are protected against taxation. The bottom line is that Congress needs to remove all the obstacles to a vibrant digital currency that has voluntarily taken the initiative to keep the bad guys from using it.”