Crypto Rules Under Fire: Lawmakers Clash Over National Security Threats
1min read In a recent House Financial Services Committee hearing, U.S. Representative Sean Casten, an Illinois Congressperson, expressed concerns about the potential national security threats posed by "crypto-friendly rules." Casten, a libertarian-leaning lawmaker, argued that these rules could make it nearly impossible to trace the source of funds used in financial transactions, including those related to ransomware attacks.
During the debate on H.R. 1716, the "Taiwan Conflict Deterrence Act of 2025," Casten criticized President Donald Trump and Elon Musk for allegedly dismantling Anti-Money Laundering and financial surveillance laws. He stated that 100% of ransomware attacks in the United States were funded by cryptocurrencies, and that easing oversight of crypto transactions would make it easier to traffic money.
Pro-crypto Congressperson Warren Davidson responded to Casten, arguing that the United States should not become a surveillance state to deter threats from other countries. Davidson urged lawmakers to adhere to the principles outlined in the U.S. Constitution.
Separately, former National Security Agency (NSA) contractor and whistleblower Edward Snowden warned in April 2024 that the NSA was days away from taking over the internet. Snowden cited expansions to section 702 of the Foreign Intelligence Surveillance Act (FISA) and the vague language used to describe an "electronic communications surveillance provider," which could potentially compel nearly every individual to act as a surveillance agent for the U.S. government.
In November 2024, Snowden sounded the alarm on centralized blockchains and artificial intelligence, calling for decentralization as a bulwark against the threats posed by concentrations of digital power. These warnings were echoed by David Holtzman, a former military intelligence professional and chief strategy officer of the Naoris decentralized security protocol, in December 2024.
