Bill Overview
Title: Digital Asset Sanctions Compliance Enhancement Act of 2022
Description: This bill allows additional sanctions against Russia and creates specified reporting requirements regarding digital assets. Specifically, the President must periodically identify foreign persons who facilitate evasion of Russian sanctions using digital assets. The bill authorizes sanctions against such persons. The bill requires a U.S. taxpayer engaged in offshore digital asset transactions greater than $10,000 to file an annual Report of Foreign Bank and Financial Accounts with the Financial Crimes Enforcement Network. The bill allows the Department of the Treasury to prohibit U.S. digital asset trading platforms and transaction facilitators from transacting with Russian digital asset addresses. Additionally, Treasury must report on its progress in implementing the bill and must annually identify foreign digital asset trading platforms that are a high risk for sanctions evasion, money laundering, and other illicit activities.
Sponsors: Sen. Warren, Elizabeth [D-MA]
Target Audience
Population: People involved in digital asset transactions and trading platforms
Estimated Size: 2000000
- The bill targets individuals and entities involved in digital asset transactions, specifically those involved in evading sanctions on Russia.
- It impacts foreign persons facilitating such evasion, as they may face sanctions.
- U.S. citizens involved in offshore digital asset transactions over $10,000 have new reporting requirements, impacting U.S. taxpayers dealing with digital currencies internationally.
- The bill affects digital asset trading platforms worldwide, especially those high-risk for sanctions evasion.
Reasoning
- The selected population involves individuals engaged in digital asset transactions both internationally and domestically.
- Among those impacted in the U.S., there are crypto investors, business owners dealing with international clients, and digital asset trading platform employees.
- Some individuals will not be affected directly if they don't engage with Russian entities or conduct significant offshore transactions.
- The budget constraints require a focus on efficiently monitoring and implementing the policy through technological means.
- Given the large number of target individuals, specific focus will be on high-value transactions or those directly indicated as facilitating evasion.
Simulated Interviews
Crypto Trader (New York, NY)
Age: 32 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 5/20
Statement of Opinion:
- I'm concerned about the increased reporting burden.
- This might discourage some from investing in crypto.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 6 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 8 |
| Year 10 | 7 | 8 |
| Year 20 | 8 | 9 |
Tech Entrepreneur (San Francisco, CA)
Age: 45 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 10.0 years
Commonness: 3/20
Statement of Opinion:
- This could impact international operations.
- Compliance might increase operational costs.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 8 |
| Year 2 | 7 | 8 |
| Year 3 | 7 | 8 |
| Year 5 | 8 | 9 |
| Year 10 | 8 | 9 |
| Year 20 | 9 | 9 |
Software Developer (Miami, FL)
Age: 28 | Gender: other
Wellbeing Before Policy: 6
Duration of Impact: 3.0 years
Commonness: 7/20
Statement of Opinion:
- New regulations could open up safer markets.
- Interested in how compliance tech will evolve.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 8 |
| Year 20 | 9 | 8 |
Financial Analyst (Seattle, WA)
Age: 38 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 4/20
Statement of Opinion:
- Sanctions are necessary for fair trade.
- The compliance aspect will be crucial.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 7 | 8 |
| Year 3 | 7 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 9 |
| Year 20 | 9 | 9 |
Tax Consultant (Chicago, IL)
Age: 50 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 10.0 years
Commonness: 6/20
Statement of Opinion:
- This policy will likely increase my workload.
- It will need clear guidelines for proper implementation.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 9 | 8 |
| Year 5 | 9 | 9 |
| Year 10 | 9 | 9 |
| Year 20 | 10 | 9 |
College Student (Austin, TX)
Age: 22 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 8/20
Statement of Opinion:
- I'm worried it could stifle the crypto ecosystem.
- Regulation is sometimes necessary but should be balanced.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 4 | 5 |
| Year 2 | 5 | 6 |
| Year 3 | 5 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 6 | 7 |
| Year 20 | 7 | 7 |
Retired (Houston, TX)
Age: 60 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 0.0 years
Commonness: 10/20
Statement of Opinion:
- I'm not directly affected, but I support measures against Russia's violations.
- Digital assets should remain secure and transparent.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 6 | 6 |
| Year 20 | 6 | 6 |
Digital Marketing Manager (Boston, MA)
Age: 29 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 0.0 years
Commonness: 9/20
Statement of Opinion:
- It doesn't directly affect my work, but the wider implications on digital commerce are interesting.
- We need clear regulations more than restrictive ones.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Film Producer (Los Angeles, CA)
Age: 40 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 4/20
Statement of Opinion:
- This might complicate deals involving foreign funding.
- We may need to reassess our investment strategy.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 6 | 7 |
| Year 3 | 7 | 8 |
| Year 5 | 7 | 8 |
| Year 10 | 8 | 9 |
| Year 20 | 8 | 9 |
Freelancer in Tech (Denver, CO)
Age: 27 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 2.0 years
Commonness: 7/20
Statement of Opinion:
- I'm not too affected as my transactions are minimal.
- The policy seems focused on high-value transactions.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 9 | 9 |
Cost Estimates
Year 1: $30000000 (Low: $25000000, High: $35000000)
Year 2: $31000000 (Low: $26000000, High: $36000000)
Year 3: $32000000 (Low: $27000000, High: $37000000)
Year 5: $34000000 (Low: $29000000, High: $39000000)
Year 10: $38000000 (Low: $33000000, High: $43000000)
Year 100: $60000000 (Low: $55000000, High: $65000000)
Key Considerations
- The bill involves significant ongoing costs to ensure compliance and enforcement.
- Potential savings and revenue enhancements are indirect and difficult to measure directly against the costs.
- The international reach and complexity of digital assets require a robust implementation mechanism to avoid circumvention.
- Long-term effects may include enhanced cybersecurity and compliance with international financial norms.