Senator Elizabeth Warren recently addressed Treasury Secretary Janet Yellen in a letter, echoing her concerns voiced during Deputy Treasury Secretary Wally Adeyemo’s testimony before the Senate Banking Committee on April 9. The focus of her letter remains on Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) measures.
In her letter, Warren expressed her backing for the legislative incorporation of robust AML/CFT measures specifically targeting stablecoins. This advocacy aligns with the Treasury’s proposals, including expanding sanctions powers to blockchain validator node operators, presented during Adeyemo’s testimony.
Warren underscored the importance of integrating these authorities into any forthcoming legislation aimed at establishing a new regulatory framework for the $157 billion stablecoin market. She referenced the Treasury’s objectives outlined in a document sent to Congress in November 2023, highlighting the need for enhanced enforcement to address regulatory gaps.
It appears that Warren’s remarks were not directed at the stablecoin bill introduced by Senators Kirsten Gillibrand and Cynthia Lummis on April 17. Instead, she seemed to anticipate a bill from the House of Representatives, potentially spearheaded by Finance Committee chair Patrick McHenry and ranking member Maxine Waters. Warren expressed similar concerns in a letter to them dated April 8.
Warren emphasized that any stablecoin legislation must incorporate the full spectrum of AML tools outlined in the Treasury’s November 2023 communication to Congress to effectively combat the threat of terrorism financing.
Taylor Barr from the Digital Chamber commented on X, possibly referencing the Lummis-Gillibrand bill, highlighting the absence of Senator Warren’s commentary on increased consumer protection language, receivership provisions, or the enforcement powers of the Federal Reserve and Office of the Comptroller of the Currency (OCC) in her statements.
Senator Warren’s advocacy for comprehensive AML/CFT measures underscores the ongoing debate surrounding stablecoin regulation and its implications for financial security and integrity.
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