Bill > HR4394

This bill establishes a comprehensive framework to address anti-money laundering (AML) challenges in decentralized finance (DeFi) services. The Secretary of the Treasury is required to develop a public-private partnership program within six months of enactment, bringing together government agencies and DeFi experts to examine innovative solutions for combating financial crimes. The program will focus on integrating anti-money laundering, identity verification, sanctions, and cybersecurity controls into decentralized smart contracts, testing these controls, and exploring ways to upgrade contract behavior after deployment. The bill mandates that the Financial Crimes Enforcement Network (FinCEN) publish an advisory on responsible DeFi development within 18 months, and requires the Treasury to issue rules within 30 months that formally define DeFi services and smart contracts, and explicitly require DeFi services to implement risk-based AML and sanctions compliance programs. The legislation stems from previous government findings about the vulnerabilities of unregulated cryptocurrency platforms, including their potential exploitation by threat actors and their lack of standardized compliance processes. The public-private partnership program will sunset after 18 months, and the bill explicitly prohibits participation by certain high-level government officials or their family members to maintain program integrity and prevent conflicts of interest.

Business and Industry

https://www.congress.gov/bill/119th-congress/house-bill/4394/all-info