Broad definitions in senate bill pose risks for cryptocurrency protocols

This week, a new bill was added to the Senate's agenda, aiming to address various parts of digital asset protocols and tokens. While it does not directly prohibit these protocols, its wide-ranging terms may provide opportunities for those within the US government who oppose cryptocurrency to challenge them.

In May, the Senate Select Committee on Intelligence unanimously approved the Intelligence Authorization Act for Fiscal Year 2025 with a 17-0 vote. According to Senator Warner's office, the bill, identified as S. 4443, aims to allocate funding, grant legal authority, and enhance congressional oversight for the US Intelligence Community.

US Treasury's new authority over crypto transaction

Section 423 of the bill grants the Secretary of the Treasury the power to block transactions between any US individual and a foreign digital asset facilitator who has knowingly helped conduct major deals with foreign terrorist groups, globally designated terrorist groups, or other sanctioned entities.

The term "foreign digital asset facilitator" is broadly defined. It includes anyone abroad who manages, operates, or provides a digital asset platform, or who plays a significant role in the buying, selling, exchanging, holding, or other transactions involving digital asset transfers of value.

The bill does not outright ban protocols like Aave, Uniswap, or stablecoins such as USDT. However, if these protocols are found to have knowingly facilitated prohibited transactions with sanctioned entities, they could be labeled as foreign digital asset transaction facilitators. This would prevent US persons from using them.

It's important to note that the bill targets only those who knowingly engage in such prohibited activities, not just those who can potentially be accessed by sanctioned entities.

Tether has often frozen tokens linked to US-sanctioned entities when requested. Despite these efforts, US authorities have criticized it for allegedly enabling such transactions. Earlier this year, its competitor Circle spoke out against it before Congress.

In 2022, Aave, Uniswap, and other platforms blocked wallets interacting with Tornado Cash to meet US sanctions. However, if the Treasury determines that past activities aided sanctioned entities, this new legislation might target these platforms and potentially affect the entire crypto industry.

According to information from Senator Warner's office, the bill has moved past an important stage. It received a favorable report from the Select Committee on Intelligence and is now on the Senate calendar for more review.

FBI warns of rise in fake remote job scams

As more people work from home, fraudsters are exploiting this trend to deceive unsuspecting individuals. The United States Federal Bureau of Investigation has released a warning about a surge in fake work from home job postings, especially those that require job seekers to make cryptocurrency payments.

On June 4, the FBI noted an increase in fraudulent job offers that promise easy tasks, such as rating restaurants or enhancing services by clicking buttons. These scams typically begin with unsolicited calls or messages, ultimately presenting attractive yet deceptive job opportunities.

Victims are tricked into thinking they are making money by looking at a fake interface that displays a growing balance. But this money isn't real or accessible. The scam gets worse when the fake employer asks the victim to pay in cryptocurrency to unlock more tasks. These payments end up right in the hands of the scammers.

The FBI has highlighted some warning signs to help people recognize these scams. Job postings that excessively use the term optimization and skip reference checks during hiring are especially questionable. If a potential employer requests cryptocurrency payments as part of the job application process, it's almost definitely fraudulent.

With more people working from home, there's a bigger risk of falling for online scams. Statista reports that the number of remote workers worldwide will reach 28% by the end of 2023. While remote work brings more flexibility, it also opens the door to new kinds of online threats and scams.