Peter Van Valkenburgh
@valkenburgh
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Executive Director @CoinCenter | “Writing a description for this thing for general audiences is bloody hard. There's nothing to relate it to.” Satoshi Nakamoto
Joined July 2009
Lots of crypto optimism headed into 2025 but we have some serious work to do. Here are Coin Center's priorities and strategies for making sure that America is the best place to build and use crypto. Full post after the break.
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Oh man. Not sure how I missed this. Apparently PETA and Old Bay have been having a billboard battle in Maryland:
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A new SEC proposal has a serious change hidden within its complex language. Bottom line: The proposal violates the First Amendment by requiring a license to speak—even of open source developers. It’s unconstitutional and they should change it. Coin Center is pushing back 👇 1/.
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I know there's a lot going on right now but I don't think the head of the BIS saying "central banks will have absolute control" over your financial transactions with CBDCs has gotten enough attention.
Saying the quiet part out loud:.Central banks will control how you spend your money. #Bitcoin fixes👇
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Tornado, Samourai, and a Warning: . In a surprising and concerning shift, the DOJ has targeted non-custodial crypto wallet developers for unlicensed money transmission, which starkly deviates from longstanding U.S. policy. This abrupt move, seen in recent charges against.
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One day he will @ me.
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1/ New detailed factual explanation of how Tornado Cash works. Huge thanks to @wadeAlexC and @LewellenMichael for this unbiased description of exactly how the contracts function. It confirms a level of decentralization that was surprising, even to me.
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1/ Clayton's testimony on cryptocurrencies is here:
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America, home of the free. Where you will be accused of crimes for choosing not to design software the way the government wants you to design software:
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Senators Warren and Marshall's proposed bill subjecting software devs & nodes to AML is "a repudiation of liberal values and a move towards the types of surveillance and control prized by authoritarians like Vladimir Putin, Xi Jinping, and Kim Jong-un".
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This is the most outrageous thing I've encountered since starting at Coin Center in 2014. Alexey Pertsev deserves to be free or else charged with a crime. In the US they can't hold you for more than 72 hours. This 6 hours or up to 90 days Dutch rule is an affront to human rights.
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Sensational early reporting on the scale of Hamas crypto fundraising significantly misstated the amounts involved. In this important debunking Chainalysis shows how actual terrorist usage may be 1/2-of-1% of the previously reported numbers.
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Today, Coin Center filed an amicus brief in Roman Storm's criminal case. The government has wrongly charged the Tornado Cash developers with criminal conspiracy and we are here to help set the record straight and defend First Amendment rights to publish software. Our brief
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I saw the best minds of my generation destroyed by blockchain, hyped-up, networking in the street, and nakedly unaware that an oracle database would suffice.
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The study of complexity has revealed that each of us has a far greater impact on the lives of others than we might expect, and far less ability to understand what that impact might be. Can't think of a better reason to be extra kind, stoic, and peaceful as I go through my life.
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If the infrastructure bill is the first time you are learning about Senator Wyden check out this 1996 speech where he argues for a hands off, market-based approach to crypto (which stands for cryptography). He's a national treasure.
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1/ Responding to Senator Warren's bill reminded me why I still believe in crypto: electronic cash. A defining characteristic that separates America from illiberal regimes like North Korea, China, and Russia is our reverence for individual autonomy, privacy, and dignity.
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Please feel free to hate Bitcoin, but do not let that hatred push you into the arms of totalitarians who want to leverage financial surveillance to eradicate minority ethnicities, cultures, and languages.
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fun fact: the US government can still use tornado cash
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It’s time to have the conversation: Is the Bank Secrecy Act unconstitutional?.Beyond the speech and privacy issues, the BSA is a sweeping delegation of law making power. Today we're publishing a new report explaining in detail why that's a problem. 📜Full report is linked in the.
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Today: These guys are talking about Bitcoin in the Senate and this guy is launching his electric sports car to mars. Don't ever complain about the cypherpunk future that you got.
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We are, indeed, falling behind china in banning things.
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What I've learned. Keep this gif playing on your phone under the desk and glance at it to stay zen while testifying about ICOs in front of angry congressmen:
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Here are our initial thoughts on today's Tornado Cash indictment. The factual allegations of unlicensed money transmission are in conflict with FinCEN's longstanding guidance that an "anonymizing software provider is not a money transmitter.".
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There's new FATF draft guidance for crypto, and its not good.
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If the SEC news today has you confused or frustrated. I highly recommend you read our comment letter from last April (yes, same rulemaking). It summarizes the rule change wrt crypto and outlines why it would likely be unconstitutional.
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1/ OFAC today repealed the Tornado Cash designation that Coin Center is challenging in court and then replaced it with a new one. Nothing they've announced changes our strategy in this lawsuit.
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Good thing it was in front of the Senate!.
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"The law deserves respect, but technological progress should not be bound by the limits of the regulator’s lawyerly imagination." SEC Commissioner Peirce gave an incredible speech about tokens and regulation. Read it all:
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When someone says they regret not banning Bitcoin back when it was small they're revealing a willingness to run roughshod over people's rights, but only when those people are a marginal minority.
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FYI the 10 years of clear guidance from FinCEN that says that money transmission in crypto requires control over the funds is irrelevant because pans transfer heat and usb cables transfer bits without controlling heat and bits.
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We will wait to see what happens with the Tornado Cash and Samourai Wallet prosecutions. But the memo from the Deputy Attorney General yesterday is right on target: we should be going after bad guys. Not the developers of good tools that bad guys happen to use.
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You need to see this. This is NOT a crypto problem. Every institution crypto or trad is about to face massive ID fraud because of AI. Crypto is, in fact, the only solution, b/c physical ids and pictures of them is now a garbage fire of fake (actually has been for a long time but.
New: inside the underground site where "neural networks" churn out fake IDs.- I tested, made two IDs in minutes .- used one to successfully bypass the identity verification check on a cryptocurrency exchange .- massive implications for crime, cybersecurity.
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Two victories in our fight against unconstitutional financial surveillance. 1. Coin Center won an appeal in our challenge to 6050I reporting. 2. IRS released new draft tax form for cryptocurrency brokers removing the “unhosted wallet provider" box we protested.Before/After:
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Coin Center wrote an open letter to the W3C: decentralized identity standards shouldn't be waylaid by erroneous and unrelated environmental concerns.
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Fedwire has two back up facilities. One in New Jersey and one in Richmond. 💵. Bitcoin has (checks notes) 10,195 backup facilities in over 100 countries across the world. 🚀
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📃📃📃 Read our newly published deeper analysis of the Tornado Cash OFAC action: I'm particularly proud of our procedural due process analysis. This may be even stronger than the First Amendment claims.
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Another 250 million in illicit transactions facilitated by the financial messaging system SWIFT. They are not under any legal obligation to do KYC/AML for these transactions despite having full control over who can and cannot send messages on their network.
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Really impressive victory for Bitcoin policy and the rule of law generally.
BREAKING: the Biden Administration is cancelling the fake #Bitcoin mining "emergency" declaration and destroying the data that it illegally collected. The government is going to restart the process the legal way: with public notice and comment. The government is also paying
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Your constitutional privacy rights are under threat. Say it with me: . 👏 no 👏 third-party 👏 doctrine 👏 in 👏 two-party 👏 transactions 👏. #getawarrant.
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Quick! Amend the securities laws! We must outlaw "doing it for the lulz.".
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If you buy a cow and didn't know it was pregnant and the cow was pregnant and the baby was a mutant swamp monster cow baby and the IRS found out. income event.
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I may not agree with your shitcoin, sir, but i will defend to the death your right to shit it.
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So it looks like Speaker Pelosi’s recent draft COVID-19 stimulus bill includes a digital dollar section.
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I kinda want a pinterest board of regulators and lawmakers holding invisible boxes when talking about technology.
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It's one thing to do "regulation by enforcement," as we've arguably seen from the SEC. It's even worse to see the DOJ engage in regulation by criminal prosecution. That's exactly what is happening with the unlicensed money transmission charges against Tornado Cash and Samourai.
Read our full analysis on the Samourai Wallet indictment and related actions here:
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I don't know who needs to hear this but if the big regulatory battles are being fought about a different cryptocurrency, it's not because your preferred crypto is more decentralized, it's because governments aren't worried about the things it does and how it does them.
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My friend and Coin Center fellow, Michael Lewellen, is suing the DOJ for their unlawful interpretation of federal money transmission laws as exemplified in the Tornado Cash and Samourai Wallet prosecutions. @coincenter is supporting him to defend his right to publish.
Today, I’m taking a stand against the Biden administration’s unjust crackdown on crypto development. I’ve filed a lawsuit against the DOJ to challenge their flawed and unjust interpretation of the law. My work on Pharos—a non-custodial protocol for public goods.
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This whole Cicada thing would be way more interesting if instead of millions of one ounce bugs we got a single million-ounce bug every 17 years.
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Read our full analysis on the Samourai Wallet indictment and related actions here:
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I can feel it. Anti-seed-oil movement is about to go mainstream. Gonna be weird.
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🚨 We're still digesting the potential constitutional ramifications. Either way, big development in real limitations on your legitimate privacy rights. Read the post.
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Surely the problem is meat.
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Everyone knows that the US pioneered the internet because in 1994 Congress voted to make the x.25 packet switching network illegal, detained the developers of the xanadu project, and thereby cemented TCP/IP as the global standard.
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That wallet in your pocket? it's a money transmitter. How do I know? Because the DOJ says that if you can only put money into it and take money out of it, then you don't actually have control over it, the wallet developer does.
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I'm getting that old feeling where I'm headed to school and still haven't done the homework for the day. Except the homework is base layer privacy for cryptocurrencies and the school is all the laws that will crush anything with censorship resistance but no privacy.
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Bitcoin: a $200,000 bounty every 10 minutes to find the cheapest electricity on the planet. (spoiler alert it's solar, geothermal, and hydro)
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My preliminary thoughts on the Pertsev verdict in this thread. I'm sad for Alexey and angry that the money laundering laws in the Netherlands have such a low threshold for intent, essentially mere negligence. Nothing in this ruling should prejudice or carry weight in Roman.
Some of this would be highly questionable under US constitutional law. Unlike in the SDNY case that focuses primarily on ongoing activities of the defendants the Dutch ruling seems to come straight out and say that you can be criminally responsible merely for inventing a
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Some morning spiciness excerpted from our broker comment letter to the IRS: . We can only speculate why the Treasury Department is brazenly going beyond the statutory authority granted them by Congress and seeking to impose recordkeeping and reporting requirements on persons who.
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A stock market bull run immediately after 3 million people file for unemployment is probably the most dystopian thing I've ever seen.
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Technology got us into this mass surveillance mess (credit cards, electronic banking); hopefully technology can get us out (cryptocurrency, zk proofs).
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Our take on the Treasury DeFi Assessment: . "To summarize, our constitutional rights to speech and privacy are not a gap in the money laundering laws. They are the supreme law of the land." . Read the whole thing: .
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By not providing for a fully anonymous bearer instrument currency that works online our government is failing to uphold a basic liberty assumption that was shared by our founding fathers: that every American can pay and get paid without anyone else involved.
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Building a company from scratch to successfully code the first version of a zk-powered privacy-respecting electronic cash by bodging together academic papers and the bitcoin core client. Releasing it open source. Organizing some of the largest and most consequential multi-party.
News: I’m stepping down from the role of CEO of the Electric Coin Co, but I’ll never leave Zcash. A brief personal reflection:
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2.5 years ago at a Zcash conference I learned the US Treasury was banning Americans from Tornado Cash. Talking with @LewellenMichael, @ameensol, & others I learned the facts and determined we should and could fight back on the law. I gave a speech sharing our strategy:
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I’m excited for the next 10 years of Coin Center. Now more than ever we must defend our digital civil liberties. It’s bittersweet to see Jerry and Robin move on to new things, and I’m humbled and honored to help fill their shoes.
Some personal news. Coin Center celebrated its tenth anniversary earlier this year, which was an incredible milestone, and we think it’s the right time for another one. At the end of the year I will step down as Executive Director, and Robin Weisman will step down as Senior.
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@SenWarren @USGAO Two claims in this post are misleading or false. 1. False claim: the post says that crypto does not already follow the same anti-money laundering rules as "everyone else." . For at least 11 years now, the exact same AML rules have applied to intermediated crypto activities as to.
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It bothers me that when Senator Warren discussed her bill in the hearing today she kept saying, "shouldn't we apply the same rules to crypto as banks?" (A) we already do, crypto institutions in a position of trust have been required to register as MSBs since at least 2013. (B) 1/.
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New Post: The changing tide in DC on crypto. At Coin Center we're optimistic but we need to seize the moment and focus on surveillance and civil liberty issues as well as the SEC. "It’s up to us to make it clear that being “pro-crypto” doesn’t just mean choosing friendlier
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Another headline for this could have been "Don't sacrifice your cypherpunk ethos for a particular 'pro-crypto' politician or policy proposal." I entirely agree with that principle. Politicians will come and go. Privacy, speech, and the rule of law must be preserved.
Against choosing your political allegiances based on who is "pro-crypto".
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Palley on the rule of law and practice as a lawyer in this country: How are you supposed to advise clients if nothing has the permanence of law? Not only is the regulator's website saying something different than the DOJ, it's been saying the same different thing for over 10.
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1/ New Crypto Bill in Senate: read this thread or our post for the full download on what it does and what risks it poses to software developers and individual crypto users.
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Commissioner @HesterPeirce is asking the hard questions in the SEC Open Meeting about the "exchange" redefinition. She is simply reading comment letters from the last comment period and asking if any given factual hypotheticals fit the "communications protocol" definition. 1/3.
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Today I am resigning from the Zcash Foundation board to dedicate myself fully to Coin Center where I am now Executive Director.
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that feeling when even the gold bugs need to liquidate to buy n95 masks at 3000% mark up.
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Sadly the IRS did not listen to Congress about the broker rulemaking (once again). No one wants this rule, it's against statutory authority, won't increase revenue and unconstitutionally restrains speech and demands warrantless surveillance. Great bipartisan letter:.
Congress has consistently fought to protect the digital asset ecosystem from misguided regulation on a bipartisan basis. Read lawmakers’ recent bipartisan letter on this issue ⬇️
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The President's EO today is mostly about setting up the right processes and teams to improve crypto policy. That's good news. I was especially heartened that the top priority articulated in the purpose section is all about our rights to use the tech free from persecution.
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The cypherpunk ideal is not about anonymity, it's about free speech and free software. Anonymity is not an end, it's a tool to protect freedom when challenged by illiberal regimes. Full talk:
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Boeing board room as 18-year-old start up becomes first private company to launch humans into space.
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The inclusion of "unhosted wallet provider" in today's draft broker form indicates that the IRS is not heeding our warnings from last fall (when the broker NPRM was open for comment). Continuing down this road will lead to tax policies that are contradictory to the statute passed
This is HUGE: The IRS just released the first draft of Form 1099-DA, the first tax form designed specifically for crypto. Stay tuned for updates! .
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"based on my understanding of the present state of Ether, the Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions." - Director Hinman, SEC Division of Corp Fin.
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Seeing articles talking about "outrage amongst crypto advocates" That's bullshit. There should be outrage amongst anyone who believes in the rule of law and basic human dignity. There should just be outrage, full stop.
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i like people who tweet from their phone but still don't capitalize the first letter (and actually go and delete the auto-cap) because they want to look like they don't give a shit.
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Today Coin Center filed a comment explaining why the First Amendment arguments against the rule are strong and why the Supreme Court is poised to rule against the SEC should it finalize this new rule as drafted. 2/.
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Happy Thanksgiving and thank you to @VitalikButerin for the very generous donation to Coin Center. With some momentum, we're going to turn it into more court victories, less unwarranted surveillance, and clarity on who needs to register as a money transmitter (only custodians)!
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Giancarlo says: no blockchain without bitcoin. AND that had blockchain's ability to reveal and check counterparty risk existed in 2008 we may have had more and better policy choices available to respond to the crisis.
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The emergence of anonymous electronic cash & decentralized exchange software could spur new financial surveillance policy. Here's my new comprehensive paper on why licensing software developers or deputizing them to spy on users would be unconstitutional.
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In a revenue ruling released yesterday, the IRS doubled down on classifying block rewards as income when received (rather than taxing them when they are sold). This is brazenly arbitrary policy from the IRS and also bad law. 1/
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Much needed pushback on the DOJ's dangerously overbroad theory of money transmission in the Tornado Cash and Samourai cases. Thank you Senators @SenLummis and @RonWyden for your leadership.
President Biden's DOJ steamrolling the longstanding interpretation of FinCEN is legally wrong and threatens to criminalize Bitcoin software development in America. @RonWyden and I have sent a bipartisan letter to DOJ urging it to drop this interpretation immediately. ⬇️
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Every common data point currently used to establish identity hacked for almost half the US population. Need for viable blockchain ID rises.
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I like it, but those hipster glasses annoy me.
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