US Lawmakers Draft Bill 'Protecting' Cryptocurrencies From Government Interference

Tyler Durden's picture

Several members of the US Congress are drafting legislation that is intended to recognize certain digital currencies and 'protect' them against interference from the federal government. The question is - does the 'protection'

CoinTelegraph reports that the bill, which will provide protection to cryptocurrencies that comply with certain minimum requirements to prevent them from being used by those engaged in illegal business practices like drug traffickers and terrorists, is expected to be filed in September 2017, according to DailyCaller.

Based on a reliable source, at least one Republican senator and two Republican congressmen are working on the draft legislation.

The legislators, however, have requested that should not be identified due to the sensitivity of the issue and the complexity of the proposed solution.

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.”

What is perhaps most ironic here is that government lawmakers are attempting to codify rules to stop government lawmakers interfering with the free and open exchange of a decentralized currency... by setting rules that potentially interfere with the free exchange of said currency.

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GeezerGeek's picture

Distrust of government, and indeed of people in general, permeated the thoughts of those who gave us the Articles of Confederation and to a certain extent the Constitution. Most were probably familiar with Calvin's estimation of humanity and themselves recognized the propensity of people to sink into corruption. I doubt the Founding Fathers would have been surprised, except perhaps they might be surprised it lasted this long. John Adams was quite prescient when he said the Constitution was for a moral and religious people and would be insufficient for any other. Morality and religion have faded in the USSA and clearly the Constitution is disregarded by TPTB.

william114085's picture

an unnmaned source says that 3 unnamed memebers of Congess are drafting legislation........then it must be true!

aloha_snakbar's picture

LOL... the same five or so trolls always show up every time ZH puts up a Bitcon article. You guys are like a little Chihuaha dog that does not realize that its nuts have been cut off, but continues to hump our leg with your massively deluded crypto fantasies... too freakin funny...

discopimp's picture

Do you know the difference between a Chihuaha whose "nuts have been cut off" humping your leg and an Akita Inu humping your leg is?  You let the Akita Inu Finish!! 

tmosley's picture

>I DON'T LIKE BITCOIN

>BUT i KEEP SHOWING UP IN BITCOIN ARTICLES

You are the troll here, idiot.

FreeShitter's picture

Is this aloha dude the obi won guy?

tmosley's picture

Nope. He is a low level troll who shows up in all these articles.

Nothing at all to say, but I like to berate him anyways.

discopimp's picture

My second isntinct is how many tokens have these "lawmakers" been gifted by the "new entity that is considering issuing a brand new digital currency"

GOSPLAN HERO's picture

Why not protect gold and silver markets from bankster manipulation?

GIVJetMech's picture

Man, I LOVE your post! But alas, our fine government is SO AFRAID of a return to precious metals that it will take some sort of nuclear blast to get gold and silver price manipulation out of their grasp!

Scuba Steve's picture

They've already "protected" Gold n Silver.

They are just trying to help the common man and "protect" cryptos ... 

/s

tmosley's picture

Because they are fighting the last battle, as usual, and the last battle was nearly lost because they let gold and silver get away from them.

They probably won't survive this one, but if they do, they will remark that they should have kept the bitcoin price down.

But that is harder to do, since there is no centralized exchange where they can cheaply manipulate the price, nor can they issue empty paper and force the market to treat it like the real deal.

oldschool's picture

Will the coming crypto ETFs enable such manipulation?

tmosley's picture

No. A given exchange might become corrupted, but if/when that happens, their trade data is excluded from price setting mechanisms. It isn't a single, opaque ticker like on kitco. Coinmarketcap is the big one, and they disclose how they set their prices. There is some gaming, but that is usually taken care of in short order.

0valueleft's picture

Cheaply? You think that is their concern? Hasn't cost them any 1's & 0's suppressing PM's and Vix? I do love how you bend to feed your narrative. Your voice is cracking Mosley, better drink some Tang like a good astronut.

abgary1's picture

Why stop there?

Why not protect all markets from government and central bank intervention and manipulation?

Yellow_Snow's picture

Wow, just when you thought it couldn't get any better ;)

Yars Revenge's picture

"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"

 

Did this entity happen to celebrate 100 years in 2013?

Grandad Grumps's picture

The only way this would happen is if the cryptocurrencues are the babies of the banks.

loveyajimbo's picture

LOL!!!  Any of these type of moves and Bit-con is shit in the wind and the loudmouthed douchebag Mosely ends up back on the Harlem streets hawking rimjobs for $5/each.

Any crypto that can't be used for illegal purposes is totally exposed to government taxation, regulation and control.  Another tulip bubble bites the big sweaty banana.

Yellow_Snow's picture

Monero might be what your looking for - if you're up to anything nefarious.

kochevnik's picture

DigitalCurrency is for anyone who sanctions murder, but rejects racism

Goldilocks's picture

CIA, NSA, The Fed, Billionaires and Wall Street Love BitCOiN
https://www.youtube.com/watch?v=FqlL19dxVTE (4:49)
TruthNeverTold - Aug 17, 2017

EXPOSED: The real creator of Bitcoin is likely the NSA as One World Currency
http://www.zerohedge.com/news/2017-06-12/exposed-real-creator-bitcoin-li...
globalintelhub - Jun 12, 2017

Yellow_Snow's picture

Maybe they're just smart people who want a piece of the action...  Just because they work for 'the beast', doesn't mean they don't wanna get rich.  Follow the money, it's always about the money.

Aubiekong's picture

Translation - The government wants you to buy bitcoin.  If that doesn't tell you Bitcoin is a sham nothing will.  Buy what the big banks and elite are buying Gold and Silver....

Yellow_Snow's picture

Nay, The banks are starting to realize that Bitcoin is here to stay, they want a piece of the action... It's obvious that a lot of new money is getting piled in to cryptocurrencies everyday.  We, as good investors, should be taking advantage of these opportunities to make some money.  It's senseless to bash something that goes up and up everytime you look at it.  Why bicker and whine...

Wahooo's picture

Then it truly is shitcoin.

Frankly Speaking's picture

I can't predict the future of bitcoin but it will be interesting to watch. I can look into the past and confirm that central bankers are the most destructive and murderous creatures on this planet. Do you really believe they will simply go quietly into the night?

GeezerGeek's picture

I can't wait to have the Electronic Frontier Foundation chime in on this bill, if it ever sees the light of day. Meanwhile, here's my draft suggestion.

An amendment to the Constitution for the United States.

Congress shall pass no law, nor the executive branch issue any rules or executive orders, regarding establishment of private digital cryptocurrencies, or the right of the citizens of this country to freely engage in transactions using digital cryptocurrencies, nor prohibit the free exchange thereof.

Section 1. The government of the United States may not use, or interfere with, the citizens' use of, digital cryptocurrencies. They shall not be considered legal tender for debts owed by citizens to the United States1.

Section 2. Digital cryptocurrencies are not subject to civil asset forfeiture laws nor are they to be considered for income tax purposes in any manner.

Section 3. The individual States may, at their option, accept digital cryptocurrencies, provided they are immediately turned into Constitutional money.

Section 4. Anyone proposing or submitting for consideration any law infronging upon digital cryptocurrencies shall be guilty of treason and put to death.

Section 4a. Immediately. Without trial.

Section 5. No Federal, State, or local court has juristiction regarding digital currencies.

Section 7. AND WE MEAN IT!.

I'm not holding my breath.

 

Frankly Speaking's picture

It does bring to question intent when the msm reports to the positive concerning bitcoin. I somehow sense a herding into the crypto space. Could it be a vehicle to a cashless society? Just thinking out loud. Two options, cryptos or bank deposits. No cash.

DC Beastie Boy's picture

There's already decentralized exchanges and in wallet trading being set up.

Exchanges will run just like a currency, no id needed, nonhackable and no need to use the USD. 

You can buy shares of the exchanges and the transaction fees go to the owners of the exchanges.  Just like the coins and tokens.  They will be trustless and owned by thousands and reside and thousands and millions of computers, so no centralization in the exchanges, either. 

This will be the biggest step in truly making the crypto industry stable.  All of the exchanges that have gone under or folded were either hacked or the owner stole everyones money. 

The crypto industry is already protecting itself, no govt needed.

DC Beastie Boy's picture

Also, these are two of my favorite currencies, not even in the top 100 at coinmarketcap.  Yet

https://coinmarketcap.com/currencies/xtrabytes/#markets

https://coinmarketcap.com/currencies/bitsend/#markets

 

 

Ajax-1's picture

I think this proves that Bitcoin has always been a test pilot program conceived and funded by the Federal Reserve. They have wanted a digital crypto currency for a while now. 

silverer's picture

At this point, some mental "slamming on the brakes" should be in order. Something's up with this. Big time.

pizdowitz's picture

Don't snicker. Crypto-money is here to stay. All big "money handling agencies", both private and gov, need it to avoid IRS scrutiny. The people will get a free ride. A win-win no matter who you are.

Some changes in the landscape will result:
1) the DS will get deeper yet, and less visible, so the entire bizness of tacit people manipulation for the purposes of the few, at least as we have been experiencing it since 1913, will lose most, if not all, of its fundamental rationale
2) the politicians, as means to get a license to steal legally, will become less important, if not entirely useless to the "handling agencies"
3) Central banks everywhere will become the lender of first, instead of the last, resort, as their interest rates remain very low indeed to be competitive with the crypto-money

Exalt's picture

I love this Bitcoin argument, if only because it has given everyone something to argue about.

I find it pretty hard to believe Crypto will survive competition with government fiat, no currency ever seems to do so for obvious reasons. 

If it does, it's only because it suits government and you should stay the hell away from it.

Weirdly's picture

Nothing is ever done because it benefits government.  Things get done because they benefit the people that control the government.  Align your investments with them and you will win.  The USgovernment is completely captured. 

NoBillsOfCredit's picture

That's a ridiculous thing to say. I guess you're staying the hell away from Federal Reserve notes huh?

Ink Pusher's picture

I can already smell the conflicts of interest and collusion all the way up here in Canada.

NoBillsOfCredit's picture

Currency in money or not the same thing. People should stop calling crypto money cryptocurrency. The word currency game about identifying a note that is due and current. Basically and I owe you. Bitcoin, Litecoin, Etc. are not I owe you's.

GodSpeed_00's picture

Zerohedgers are mostly idiots. Good thing I don't listen to them otherwise I would be sitting on gold and silver doing nothing. Crypto to the Moon.