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Galaxy Digital has warned that a new draft crypto bill from the US Senate Banking Committee could give the Treasury Department huge new powers to monitor and control digital assets.
In a note, Galaxy said the bill represents the biggest expansion of financial oversight since the US Patriot Act. Unlike the House-passed CLARITY Act, the Senate draft includes stricter rules on illicit finance, including a “special measures” authority.
This would let the Treasury label certain countries, banks, or types of crypto transactions as high-risk for money laundering and restrict them, similar to tools used under the Patriot Act. The bill also allows a “temporary hold” on transactions, letting agencies ask stablecoin issuers and crypto platforms to freeze transfers for up to 30 days, possibly longer, without a court order.
Another part of the draft brings crypto front ends, like websites or DeFi apps, under sanctions and Anti-Money Laundering (AML) rules. Treasury could require these platforms to check wallets, block sanctioned activity, and manage risks. The bill also targets “DeFi in name only” projects, imposing Bank Secrecy Act rules on anyone with real control over them.
Galaxy said these powers would be the largest expansion of financial surveillance since the Patriot Act. The Crypto Council for Innovation (CCI) welcomed the updated draft, saying it shows progress on an important crypto policy. CCI is also reviewing the bill and talking with lawmakers, stressing that any final rules should protect consumer choice and encourage fair competition.
The draft highlights the balance the government is trying to strike between regulating crypto and allowing innovation, and any law passed could greatly change how digital assets are monitored in the U.S.
Read more on InsideBitcoins.com
