Senator Lummis Condemns DOJ's Attack on Bitcoin and DeFi

U.S. Senator Cynthia Lummis has criticized the Department of Justice (DOJ) for its interpretation of regulations surrounding non-custodial software wallets, which she believes contradicts previous guidance from the Treasury and criminalizes fundamental aspects of Bitcoin and decentralized finance.

Senator Lummis Denounces DOJ's Assault on Bitcoin and Decentralized Finance

Washington, D.C. - U.S. Senator Cynthia Lummis (R-WY) has vehemently criticized the Department of Justice (DOJ) for its recent interpretation of regulations surrounding non-custodial software wallets. This interpretation, Lummis argues, is not only legally flawed but also imperils the very foundations of Bitcoin and decentralized finance.

"The Biden administration's criminalization of core principles of the Bitcoin network and decentralized finance is deeply troubling," Lummis declared in a statement. "This misguided approach threatens to undermine basic property rights, which are the bedrock of our American values."

The DOJ's actions, which have included the filing of criminal charges against developers associated with the Bitcoin mixer Samourai Wallet and the Tornado Cash platform, stem from its classification of these platforms as unauthorized money transmission activities. However, Lummis contends that this interpretation is antithetical to the Treasury's previous guidance, which recognized non-custodial software wallets as potential means of money transmission.

"This abrupt shift in policy creates a dangerous precedent that could criminalize the very essence of Bitcoin and decentralized finance," Lummis asserted. "It undermines the ability of individuals to hold their own keys and run their own nodes, which are fundamental principles of these technologies."

Lummis's concerns have resonated deeply within the cryptocurrency community. Coin Center, a digital currency and blockchain technology advocacy group, has condemned the DOJ's interpretation as "overreaching" and "too broad."

"The DOJ's position suggests that every functional cryptocurrency wallet and smart contract is performing money transmission," said Peter Van Valkenburgh, Coin Center's director of research. "This goes far beyond the traditional definition of money transmission and could stifle innovation in the digital currency space."

Legal experts have also expressed alarm over the DOJ's actions. William McGovern, a partner at the law firm McDermott Will & Emery, argues that the DOJ's interpretation is "fundamentally flawed" and "based on a misunderstanding of how Bitcoin and decentralized finance operate."

"Non-custodial software wallets are merely tools that allow individuals to hold and manage their own digital assets," McGovern explained. "They do not meet the definition of money transmission under the law."

The cryptocurrency industry is watching closely as the legal battle between the DOJ and the developers of Samourai Wallet and Tornado Cash unfolds. The outcome of this case will have significant implications for the future of Bitcoin and decentralized finance.

"We cannot allow the government to criminalize innovation and fundamental property rights," Lummis concluded. "I will continue to fight to protect the rights of individuals to use and develop digital currencies and will work to ensure that the DOJ is held accountable for its overreach."