Law enforcement urges crypto bill change over investigation

A coalition of law enforcement organizations and a Catholic anti-trafficking network are urging U.S. lawmakers to revise a key provision of the proposed Digital Asset Market Clarity Act, warning that it could hinder investigations into illicit financial activity. The pushback comes as the bill's sponsors aim for a Senate vote in July, a timeline now complicated by a shortened legislative calendar.

The law enforcement coalition, representing over 70,000 professionals including prosecutors, sheriffs, and police chiefs, sent a letter to administration officials on June 23. Their primary concern is Section 604 of the bill, which aims to clarify that non-custodial software developers and blockchain infrastructure providers are not automatically classified as money transmitters. The coalition argues the provision's "broad exemptions could shield facilitators of illicit movement" and reduce transparency, potentially complicating probes into crimes like money laundering, human trafficking, and sanctions evasion. They specifically highlighted risks involving decentralized finance businesses, mixers, and tumblers.

In a separate letter, the Alliance to End Human Trafficking echoed these...