Even the Secret Service thinks the Infrastructure bill is too aggressive against crypto

Key intelligence and law-enforcement officials are joining industry leaders in issuing warnings against policy makers for overly aggressive regulations that risk exacerbating national-security hazards.

The bill as written captures corners of the industry not focused on transactions, including everything from miners and stakers to producers of the hardware and software used in crypto markets.

Overregulation “may push illicit use and criminal actors deeper into anonymizing methods and corners of the internet that would make it more difficult for law enforcement,” said Jeremy Sheridan, assistant director of the U.S. Secret Service’s investigations office.

“This is the most urgent national-security issue of our time,” said Sigal Mandelker, Treasury’s former undersecretary for terrorism and financial intelligence and now at Ribbit Capital, a venture-capital firm invested in crypto

“The U.S. has to make a decision if it wants to be a center of…transformational technology that can bring many more people into the financial ecosystem,” Ms. Mandelker said. If regulations push innovation out of the country, within five years the U.S. will really get left behind, and that is the threat here.”