Two senators wrote a letter to the Justice Department challenging FinCEN’s “unprecedented interpretation” of the rules used to sue cryptocurrency mixers.
Senators Cynthia Lummis (R-Wyo.) and Ron Wyden (D-Ore.) joined U.S. Attorney General Merrick Garland and the Department of Justice (DOJ) in relation to the ongoing crackdown on cryptocurrency mixers known to operate as illicit money transmitters. petitioned.
Senator Wyden emphasized that holding non-custodial cryptocurrency software developers liable for alleged criminal conduct would violate the First Amendment and overturn years of legal precedent.
The issue stems from the Financial Crimes Enforcement Network’s (FinCEN) view that any cryptocurrency mixer or service that allows trading of assets meets the requirements of the sender and will therefore be subject to registration with the authorities.
The two senators argued that FinCEN’s latest views, confirmed in a filing last month, directly contradict the actual meaning of the law. According to a bipartisan letter dated May 9 and a letter released May 13, the Service must exercise control over the assets to qualify as a money transmitter under the provision.
“Wallet software is no more responsible for illicit finance than a bank robber’s getaway car is for the highway.”
councilor Cynthia Loomis
Cryptocurrency Mixer, War on Digital Assets
Senators Lummis and Wyden questioned the DOJ’s methods with FinCEN following the incidents against cryptocurrency mixers such as Samourai Wallet and Tornado Cash. Five founders who are credited with helping develop the platform have been arrested or are awaiting sentencing in their respective court cases.
Industry advocates argue that developers should not be held responsible for criminal uses of software, noting that blaming individuals for writing code can stifle innovation and technological progress.
Some on-chain participants also expressed their opinion that users are being neglected due to the lack of clear digital asset policies in the United States. Several bills in Congress seek to address these issues, but experts doubt any specific legislation will be finalized in an election year.