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Mind Of Mav

The Worst Anti-Crypto Bill Just Surfaced In The US – What To Know

Today, we learned of a truly atrocious bill, called the America COMPETES Act, that contains a provision which puts crypto squarely in its crosshairs in order to unfairly control it. 

Just released, the language in the America COMPETES Act of 2022 (see page 1482)—a bill ostensibly about economic competitiveness with China—would strip all administrative procedures and safeguards from the imposition of so-called “special measures” prohibitions in the Bank Secrecy Act while simultaneously expanding authority for such prohibitions to cryptocurrency activities. In brief, it would hand the Treasury Secretary unchecked discretion to forbid financial institutions (including cryptocurrency exchanges) from offering their customers access to cryptocurrency networks. The Secretary may not use this discretion immediately, but it is not power the Department should have. 

Essentially, this bill, if it includes the new language, would help the US compete with China not on economic growth and innovation, but on denying citizens due process and human rights. That should scare you regardless if you live in the US or not.

In summary, the provision would do two things:

1. Remove all public notice and administrative process and duration limitations on the Secretary’s existing power to surveil, condition, or prohibit customer activities at domestic financial institutions associated with primary money laundering concerns (sometimes referred to as “special measures” and found at 31 U.S.C. § 5318A).

2. Expand the list of “special measures” the Secretary can take to include prohibiting or conditioning any transaction deemed a “transmittal of funds.”

The existing provisions include administrative safeguards, a notice and comments period.

The new provisions remove these controls.

The proposed language in the America COMPETES Act would, and we cannot stress this enough, remove all formal controls, time limits, and public notice requirements from the imposition of these draconian measures. It eliminates the notice and comment process (both in advance of prohibitions and after surveillance impositions) and it allows the Secretary to impose these measures “by order, regulation, or otherwise as permitted by law” permanently and secretly with no obligation to engage in a public process.

As per Coincenter, even the existing provisions can be applied for crypto:

The special measures as they presently exist can already be interpreted as applying to cryptocurrency accounts at financial institutions. There is absolutely no need to increase the scope of the treasury’s authority here. Like the unnecessary redefinition of “broker” in the infrastructure bill last summer, the parts of this language aimed at cryptocurrencies are entirely unnecessary while the removal of procedures and the creation of unlimited administrative discretion is deeply consequential. In other words it is an attempt (deliberate or not) to use the moral panic surrounding criminal usage of cryptocurrencies (as evidenced by the provision’s findings) to strip our surveillance laws of all public processes. Even if you don’t particularly care about cryptocurrencies, this encroachment on basic privacy rights must be opposed.

Below, the current law is redlined to show how it would read if this new provision was to be passed into law. It shows specifically the procedural changes proposed to subsection (a). As is plain, the deletion of section (2) removes a requirement that prohibitions (subsection (b)(5)) be imposed by regulation only, such that any special measure can be imposed “by order, regulation, or otherwise as permitted by law” (the new language at the top of (a)(1)). “Otherwise permitted by law” is a regrettably common catch-all in legislation which basically means “if the Department’s lawyers can find a credible authority anywhere on the books to do something, then they can do it. Rather than have a specific process for imposing these harsh and constitutionally suspect controls, says the proposed law, any process will do. It’s a legal kludge.

The deletion of section (3) removes the 120-day duration limitation for special measures imposed without regulation (which can now be any/all of them).

Together, these changes mean that the Secretary would be able to (a) impose measures against financial institutions through any process (even a phone call from a deputized prosecutor would likely suffice given these non-existent procedural safeguards), to (b) avoid any public notice and comment process to alert the public to measures and solicit feedback, and (c) make these measures apply into perpetuity even if they haven’t been made through regulation.

This amendment offers the Secretary an entirely unchecked power to secretly ban or condition any transaction at any domestic financial institution. It is a dangerously authoritarian approach to solving money laundering concerns. Additionally, the delegated power to the Secretary to arbitrarily define and redefine the term “transmittal of funds” is an offense to our separation of powers and the rule of law. Congress and Congress alone is empowered by our constitution to make law; handing unelected officials at Treasury an ambiguous power to decide that certain customer activities at banks and other financial institutions can be blocked one day and not blocked the next is unconstitutional, unfair, and exactly what you would expect from a totalitarian regime, not from a well-functioning democracy.


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What is the goal of this portfolio?

The “Three Token Pillars” portfolio is democratically proportioned between the Three Pillars of the Token Economy & Interchain:

CryptoCurreny – Security Tokens (STO) – Decentralized Finance (DeFi)

With this portfolio, we will identify and take advantage of the opportunities within the Three
Pillars of ReadySetCrypto. We aim to Capitalise on the collective knowledge and experience of the RSC
community & build model portfolios containing the premier companies and projects
in the industry and manage risk allocation suitable for as many people as

The Second Phase of the RSC Community Portfolio V3 was to give us a general idea of the weightings people desire in each of the three pillars and also member’s risk tolerance. The Third Phase of the RSC Community Portfolio V3 has us closing in on a finalized portfolio allocation before we consolidated onto the highest quality projects.

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What is the goal of this portfolio? 

The “Top Ten Crypto” portfolio is a democratically proportioned portfolio balanced based on votes from members of the RSC community as to what they believe are the top 10 projects by potential.
This portfolio should be much more useful given the ever-changing market dynamics. In short, you rank the projects you believe deserve a spot in the top 10. It should represent a portfolio and rank that you believe will stand the test of time. Once we have a good cross-section, we can study and make an assessment as to where we see value and perhaps where some diamonds in the rough opportunities exist. In a perfect world, we will end up with a Pareto-style distribution that describes the largest value capture in the market.
To give an update on the position, each one listed in low to high relative risk:
SoV/money == BTC, DCR
Platforms == ETH, XTZ
Private Money == XMR / ZEC / ZEN
DeFi == MKR / SNX and stablecoins
It is the most realistic way for us to distill the entirety of what we have learned (and that includes the RSC community opinion). We have an array of articles that have gradually picked off one by one different projects, some of which end up being many thousands of words to come to this conclusion. It is not capitulation because we all remain in the market. It is simply a consolidation of quality. We seek the cream of the crop as the milk turns sour on aggregate.

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