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Think tank Coin Center raised concerns in a press release stating that if the Restrict act is passed, it might be used broadly and unanticipatedly, affecting cryptocurrencies.
The Restrict Act, proposed by Senators Warner and Thune, intends to stop or disrupt financial holdings and transactions with foreign enemies threatening the country’s security. It was introduced in response to allegations that the Chinese-owned TikTok app collects user data for the Chinese government.
To comprehensively address the persistent threat of foreign technology, the act grants the Commerce Department new authority to examine, prevent, and mitigate information communications and technology transactions that represent an unreasonable risk to our national security.
Experts are theorizing on possible abuses of the act and potential dangers to cherished technologies, including cryptocurrencies.
The bill’s language has the potential to be used to prevent or disrupt crypto transactions. It will deny Americans access to protocols like bitcoin (BTC) in extreme situations. However, the primary targets of this legislation are companies like TikTok.
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The foreign enemies of the United States listed in Title 15 of the Code of Federal Regulations are China, Cuba, Hong Kong, North Korea, Iran, Russia, and the Maduro regime in Venezuela.
The act potentially gives the Treasury’s Office of Foreign Assets Control (OFAC) the power to prevent Americans from doing business with sanctioned parties. According to Coin Center, the sanctioning of Tornado Cash’s immutable smart contracts by OFAC exemplifies how the law has been abused to outlaw a particular technological class. Coin Center is concerned about that.
Read more: Lawyer explains what’s next in US crypto regulation