The United States has put forth a new bipartisan bill, presented by lawmakers on 8 November 2023, aiming to limit the use of China-based blockchain networks in cryptocurrency transactions.
The legislation also prohibits American government officials from engaging in transactions with iFinex, the parent entity of Tether, which issues the largest stablecoin globally, USDT.
The US regulatory authorities, led by the Securities and Exchange Commission (SEC) and other legislative proposals at the state level, have demonstrated their wariness towards cryptocurrencies.
This move signals the latest development in the ongoing standoff between the US and China concerning digital currencies.
Legislative Efforts on Cryptocurrency Regulation
Furthermore, the bill prohibits the usage of networks like The Spartan Network, Red Date Technology Co., and The Conflux Network, which form the backbone of China’s digital currency and associated blockchain products.
This measure is part of broader efforts by various lawmakers to introduce amendments related to cryptocurrencies, with a specific focus on regulating the activities of the US Securities and Exchange Commission (SEC).
One of these proposals, put forward by Tom Emmer, aims to limit the SEC’s regulatory reach while still allowing legal action against criminals and fraudsters.
The objective behind these endeavours is to safeguard critical data.
It particularly concerns the privacy of American citizens, given the increasing concerns surrounding China’s significant investments in blockchain infrastructure.
Zach Nunn, a new member of the House who joined the committee this year, said:
“Within the next decade, every American will have sensitive, private data stored using blockchain technology, so China’s heavy investment in this infrastructure poses a colossal national security and data privacy problem.”
U.S. Move to Deter China Technological Advancement?
In a bid to deter China’s technological advancement, the United States has imposed restrictions on the export of AI chips and other critical technologies.
These measures reflect the growing concerns over China’s rapid progress in the field of artificial intelligence and its potential implications for national security and global technological competition.
The US aims to curtail the country’s ability to leverage cutting-edge technologies for military and strategic purposes.
This emphasises the need to safeguard its own technological edge and maintain global leadership in the technology domain.
Therefore, by restricting federal government officials from engaging with China-based blockchain networks, the bill also aims to limit China’s influence in the realm of digital currencies and related technologies.