- Senator Cynthia Lummis criticized the Department of Justice’s stance on non-custodial crypto wallets, arguing it contradicts existing Treasury guidance and violates the rule of law.
- Lummis accused the Biden Administration of criminalizing core tenets of the Bitcoin network and decentralized finance.
- The DOJ’s interpretation of money transmission laws to encompass wallet developers with no direct control over user assets has sparked backlash from the crypto community.
United States Senator Cynthia Lummis (R-WY) has stated that she is “deeply troubled” by the Department of Justice‘s (DOJ) stance on non-custodial software. Lummis expressed concern about the DOJ’s “hyper-aggressive argument” that non-custodial software can constitute a money transmission service. She added that the DOJ’s stance “contradicts existing Treasury guidance” and “violates the rule of law.”
JUST IN:
— BlockNews.com (@blocknewsdotcom) May 1, 2024Sen @SenLummis states she is fighting for the rights of all #bitcoin holders pic.twitter.com/8PLQC1lYbJ
Lummis Accuses DOJ of Overreach
In a tweet, Lummis said the DOJ’s arguments against self-custody software threaten the “fundamental property rights that are core to being an American.” Lummis said she will fight for people’s rights to “hold your own keys and run your own node.” She further accused the Biden Administration of “criminalizing core tenants of the Bitcoin network and decentralized finance.”
Lummis’ comments follow two recent cases where DOJ prosecutors have pushed for criminal charges against software developers for unlicensed money transmission – an unsealed indictment against Bitcoin mixer Samourai Wallet and a reply brief responding to the defense’s motion to dismiss in the case against Tornado Cash developer Roman Storm.
Backlash from Crypto Community
The DOJ’s interpretation of money transmission laws to encompass wallet developers who have no direct control over user assets has sparked a backlash among the crypto community.
Crypto advocacy group Coin Center has characterized the DOJ’s stance as a “massive overreach,” arguing that it contradicts existing FinCEN guidance and rulings. Coin Center filed an amicus brief in defense of Roman Storm, arguing that the publication of Tornado Cash’s code is constitutionally protected under the First Amendment.
Conclusion
The escalating legal battle between regulators like the DOJ and SEC and crypto developers is likely to continue as the technology’s mainstream adoption increases. Senator Lummis and other policymakers sympathetic to crypto will play a key role in how regulations take shape.
