DeFi Education Fund
@fund-defi
In a paper published today in The International Academy of Financial Crime Litigators, DEF’s @atuminelli along with @jchervinsky & @dbarabander from @variant take a deep dive into the law on unlicensed money transmitting businesses, 8 U.S.C. § 1960, and argue that, based on an extensive review of the case law and statutory history, control over customer funds is necessary to define an entity as a “money transmitting business” - a business that “transfers funds on behalf of the public.” 🧵👇 https://www.defieducationfund.org/post/def-publishes-new-paper-in-in-the-international-academy-of-financial-crime-litigators
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DeFi Education Fund
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DeFi Education Fund
@fund-defi
3/ With the advent of permissionless, disintermediated blockchain technology, a new tension arose between the reality of this tech and the government’s focus on preventing crime. While the government has historically relied on the Bank Secrecy Act, the government has recently relied on Section 1960 more and more to address money laundering. While the paper is about Section 1960 more generally, it uses Tornado Cash as a case study for legal analysis.
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DeFi Education Fund
@fund-defi
4/ Section 1960 is at the center of the Tornado Cash and Samurai Wallet criminal cases. Given the upcoming Storm trial in April, where the government will have to prove Storm violated Section 1960 among other criminal code provisions, the argument in this paper is central to important legal issues facing the digital asset industry.
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DeFi Education Fund
@fund-defi
5/ Lastly, and importantly, the paper calls on Congress to change the law, specifically by amending section 1960 to clarify the original intention: “only those who knowingly control criminal funds should be treated as criminals themselves.”
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DeFi Education Fund
@fund-defi
end/ Be sure to check out another recent paper from the DEF team on the BSA. https://warpcast.com/fund-defi/0x37fe0ccf
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