I 
119TH CONGRESS 
1ST SESSION H. R. 4394 
To require the Secretary of the Treasury to develop a public-private partner-
ship program to examine innovative anti-money laundering solutions for 
decentralized finance services, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 15, 2025 
Mr. CASTEN introduced the following bill; which was referred to the 
Committee on Financial Services 
A BILL 
To require the Secretary of the Treasury to develop a public- 
private partnership program to examine innovative anti- 
money laundering solutions for decentralized finance 
services, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as ‘‘the Compliant Operations 
of Decentralized Entities Act of 2025’’ or the ‘‘the CODE 
Act of 2025’’. 
SEC. 2. FINDINGS. 
The Congress finds the following: 
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(1) In 2019, under the Trump Administration, 
the Financial Crimes Enforcement Network issued 
guidance (FIN–2019–G001) to clarify that decen-
tralized finance applications may be required to reg-
ister with the agency and comply with the Bank Se-
crecy Act, including anti-money laundering, record-
keeping, and reporting requirements. 
(2) In 2019, under the Trump Administration, 
the Financial Crimes Enforcement Network pub-
lished an advisory (FIN–2019–A003) noting that 
the prevalence of unregistered cryptocurrency enti-
ties without sufficient anti-money laundering con-
trols enables illicit activity that threatens national 
security. 
(3) In 2022, under the Biden Administration, 
the Federal Bureau of Investigation published a 
public service announcement (I–082922–PSA) en-
couraging decentralized finance services to institute 
real-time analytics, monitoring, and rigorous testing 
of the computer code to more quickly identify 
vulnerabilities and respond to indicators of sus-
picious activity. 
(4) In 2023, under the Biden Administration, 
the Commodity Futures Trading Commission issued 
a report (‘‘Decentralized Finance’’), advocating for 
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building regulatory compliance into decentralized fi-
nance systems and noting that areas like illicit fi-
nance compliance and cybersecurity are ripe for this 
kind of near-term action by software developers. 
(5) Decentralized finance services may be sub-
ject to Bank Secrecy Act requirements, but there is 
a lack of standardization across decentralized fi-
nance services and compliance processes. 
(6) Decentralized finance services present 
unique cybersecurity risks and have been vulnerable 
to exploitation campaigns by North Korean threat 
actors. 
(7) Decentralized finance services and the 
broader cryptocurrency ecosystem could benefit from 
a set of technological controls that are coherent, con-
sistent, and capable of satisfying Bank Secrecy Act 
requirements. 
SEC. 3. PUBLIC-PRIVATE PARTNERSHIP PROGRAM FOR DE-
CENTRALIZED FINANCE SERVICES. 
(a) IN GENERAL.—Not later than 6 months after the 
date of enactment of this Act, the Secretary of the Treas-
ury, in consultation with the Financial Crimes Enforce-
ment Network, the Office of Foreign Assets Control, the 
Federal Bureau of Investigation, the United States Secret 
Service, the National Institute of Standards and Tech-
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nology, the Cybersecurity and Infrastructure Security 
Agency, and such other relevant agencies as determined 
by the Secretary of the Treasury, shall develop a public- 
private partnership program with decentralized finance 
services and relevant risk management experts to— 
(1) focus on decentralized finance applications 
and front-end user interfaces; 
(2) consider integrating anti-money laundering, 
identity verification, sanctions, and cybersecurity 
controls and other technological solutions into decen-
tralized smart contracts prior to deployment on a 
public blockchain network; 
(3) test the capabilities of such integrated con-
trols in decentralized smart contracts; 
(4) consider establishing a regulatory gateway 
to external, verifiable data inputs and outputs that 
are capable of upgrading smart contract behavior 
after it has been deployed; and 
(5) provide legislative and regulatory rec-
ommendations related to integrated compliance 
mechanisms for decentralized finance services. 
(b) PROHIBITION ON CERTAIN PARTICIPANTS.—Par-
ticipants selected for the public-private partnership pro-
gram required under subsection (a) shall not include a de-
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centralized finance service owned or controlled, directly or 
indirectly, by a covered person. 
(c) SUNSET.—The public-private partnership pro-
gram developed under subsection (a) shall terminate 18 
months after the date of enactment of this Act. 
(d) RULE
OF CONSTRUCTION.—Nothing in sub-
section (a) shall be construed to limit, impair, or otherwise 
affect the supervisory, regulatory, or enforcement author-
ity or the jurisdiction of the agencies described in sub-
section (a) under any applicable law. 
(e) INTERAGENCY COORDINATION.—The Secretary of 
the Treasury shall share the recommendations provided 
pursuant to subsection (a)(5) with other appropriate agen-
cies, and such agencies shall take the recommendations 
into account when issuing rules or carrying out super-
visory functions. 
SEC. 4. FINCEN ADVISORY. 
Not later than 18 months after the date of enactment 
of this Act, the Financial Crimes Enforcement Network 
shall publish an advisory related to the responsible devel-
opment, deployment, and ongoing operation of decentral-
ized finance services on a public blockchain network for 
the purposes of strengthening compliance with the Bank 
Secrecy Act. 
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SEC. 5. RULEMAKING TO MODERNIZE AND STRENGTHEN 
BANK SECRECY ACT REQUIREMENTS FOR DE-
CENTRALIZED FINANCE SERVICES. 
Not later than 30 months after the date of enactment 
of this Act, the Secretary of the Treasury shall issue a 
rule to— 
(1) further define the terms ‘‘decentralized fi-
nance service’’ and ‘‘decentralized smart contract’’; 
and 
(2) expressly require that a decentralized fi-
nance service implements and maintains— 
(A) a risk-based anti-money laundering 
program that meets the requirements under the 
Bank Secrecy Act; and 
(B) a risk-based sanctions compliance pro-
gram. 
SEC. 6. DEFINITIONS. 
In this Act: 
(1) BANK SECRECY ACT.—The term ‘‘Bank Se-
crecy Act’’ means— 
(A) section 21 of the Federal Deposit In-
surance Act (12 U.S.C. 1829b); 
(B) chapter 2 of title I of Public Law 91– 
508 (12 U.S.C. 1951 et seq.); and 
(C) subchapter II of chapter 53 of title 31, 
United States Code. 
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(2) COVERED
PERSON.—The term ‘‘covered 
person’’ means— 
(A) the President; 
(B) the Vice President; 
(C) a Member of Congress; 
(D) a senior executive branch employee; or 
(E) the spouse, child, son-in-law, or daugh-
ter-in-law, as determined under applicable com-
mon law, of any individual described in sub-
paragraph (A), (B), (C), or (D). 
(3) DECENTRALIZED FINANCE SERVICE.—The 
term ‘‘decentralized finance service’’ means a pro-
tocol, application, or service that, through the use of 
decentralized smart contracts deployed on a public 
blockchain network, facilitates digital asset trans-
actions or the exchange of digital assets for other 
digital assets or fiat currency and may include— 
(A) a peer-to-peer digital asset trading 
platform; 
(B) a digital asset lending protocol; 
(C) a digital asset staking or liquidity serv-
ice; 
(D) a digital asset mixing service; 
(E) a cross-chain bridge service provider; 
or 
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