The Treasury Department's Latest Power Grab Has Global Ramifications

The Breakdown

Blockworks

Investing, Business

4.8 • 806 Ratings

🗓️ 1 December 2023

⏱️ 15 minutes

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Summary

The US Treasury department is asking for more power to go after bad actors in crypto in ways that many people believe represents a massive overreach with likely negative consequences for the role of the dollar in the world. Today's Sponsor: Kraken Kraken: See what crypto can be - https://kraken.com/TheBreakdown Enjoying this content? SUBSCRIBE to the Podcast: https://pod.link/1438693620 Watch on YouTube: https://www.youtube.com/nathanielwhittemorecrypto Subscribe to the newsletter: https://breakdown.beehiiv.com/ Join the discussion: https://discord.gg/VrKRrfKCz8 Follow on Twitter: NLW: https://twitter.com/nlw Breakdown: https://twitter.com/BreakdownNLW

Transcript

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0:00.0	Welcome back to The Breakdown with me, NLW.
0:09.3	It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world.
0:18.4	What's going on, guys? It is Thursday, November 30th, and today we are talking about a power grab at the Treasury.
0:25.3	Before we get into that, however, if you are enjoying the breakdown, please go subscribe to it, give it a rating, give it a review, or if you want to dive deeper into the conversation, come join us on the Breakers Discord.
0:34.1	You can find a link in the show notes or go to bit.ly slash breakdown pod.
0:38.1	Well, friends, today we are discussing a fiery topic. The U.S. Treasury is campaigning for a massive
0:44.4	expansion of power to crack down on bad actors using crypto. So where did this come from?
0:50.2	What have we heard about it? And how is the community reacting? Well, in a lengthy proposal sent to
0:55.2	the Senate Banking Committee, the Treasury presented a long list of legislative changes designed to
1:00.2	expand its enforcement powers over domestic and international crypto firms. The Treasury is asking
1:05.5	for a new category of secondary sanctions powers to be used against crypto exchanges that facilitate
1:10.8	payments to terrorist
1:11.7	groups. This would be broadly in line with how secondary sanctions are applied to traditional
1:16.5	financial intermediaries. Their next ask is to expand the definition of a financial institution
1:21.4	under the Bank Secrecy Act to capture a wide range of crypto infrastructure. The proposal would
1:26.6	include exchanges, wallet providers, validator nodes, and defy infrastructure. The proposal would include exchanges, wallet providers,
1:28.4	validator nodes, and defy services. The change would make all of these pieces of infrastructure
1:33.0	subject to know-your-client and anti-money laundering requirements. Third, is a request to create
1:38.1	a new sanctions authority to allow the Treasury to apply sanctions to blockchain nodes and other
1:43.1	elements of crypto networks.
1:44.8	This appears to be a response to push back on the tornado cash sanctions,
1:48.3	which were challenged on the basis that autonomous smart contracts are not the property of anyone,
	...

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