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The advocacy group Coin Center has urged the U.S. Senate Banking Committee to approve a bill that would protect crypto developers from legal action if they do not manage user funds.
The nonprofit organization stated that if the provisions safeguarding developers are removed from the Blockchain Regulatory Certainty Act, which has been stagnant for nearly eight years, it would hinder the advancement of blockchain technology in the United States.
The legislation was introduced in 2018 by Representative Tom Emmer. Last month, Republican Senator Cynthia Lummis from Wyoming and Democratic Senator Ron Wyden from Oregon presented a revised version of the bill, suggesting that code developers be exempt from needing a money transmission license.
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The bill aims to clarify that software developers and blockchain infrastructure providers are not considered money transmitters unless they handle customer assets. The proposal has yet to be brought to a vote by the Senate Banking Committee.
Coin Center’s Director of Compliance Jason Somensatto compared blockchain developers to internet service providers and cloud hosting companies. Somensatto pointed out that authorities do not threaten owners of such companies with imprisonment if their systems are misused for illegal activities. Similarly, developers of code who do not control user funds should be treated in the same manner. Somensatto warned that many developers might leave the U.S. if clear protective measures are not established for them.
“This is the same type of activity that internet service providers, cloud hosting companies, router manufacturers, browser developers, and email providers engage in daily,” Somensatto wrote.
Last year, a court in the Southern District of New York found Tornado Cash developer Roman Storm guilty of operating an unlicensed money transfer service. In November, a New York court sentenced the developers of the Bitcoin wallet Samourai Wallet to prison terms: Keonne Rodriguez received five years, while William Hill was sentenced to four years.
