Title: To require congressional notification prior to payments of Department of State rewards using cryptocurrencies, and for other purposes.
Policy area: International Affairs

Summary:
Russia Cryptocurrency Transparency Act
This bill requires the Department of State to appoint a Director of Digital Currency Security and take other actions related to digital currencies.
The director shall be a part of the State Department's Office of Economic Sanctions Policy and Implementation and shall be responsible for issues related to digital currencies and U.S. sanctions, including assisting in the development of sanctions policies that are resilient to digital currency use by malevolent actors.
The bill also requires the State Department to notify Congress before making a reward in cryptocurrency under an existing program that authorizes rewards for information leading to the arrest or conviction of parties responsible for certain criminal acts. (Current law allows such rewards to consist of money, nonmonetary items, or both.)
The State Department must report to Congress on any cryptocurrency payments made under the rewards program, including any justification for using cryptocurrency for such rewards.
The bill also requires the State Department to report to Congress on (1) the possible uses of cryptocurrencies or other blockchain-related technologies to provide aid to Ukraine, and (2) an assessment of how digital currencies can affect the effectiveness and enforcement of U.S. sanctions relating to Russia's invasion of Ukraine. (Blockchain is a digital ledger technology that allows for transactions without a trusted intermediary, such as a bank.)

[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7338 Introduced in House (IH)]

<DOC>






117th CONGRESS
  2d Session
                                H. R. 7338

 To require congressional notification prior to payments of Department 
of State rewards using cryptocurrencies, authorize the appointment of a 
    Director of Digital Currency Security in the Office of Economic 
Sanctions Policy and Implementation of the Department of State, and for 
                            other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 31, 2022

 Mr. Meeks (for himself and Mr. McCaul) introduced the following bill; 
which was referred to the Committee on Foreign Affairs, and in addition 
to the Committee on Financial Services, for a period to be subsequently 
   determined by the Speaker, in each case for consideration of such 
 provisions as fall within the jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL


 
 To require congressional notification prior to payments of Department 
of State rewards using cryptocurrencies, authorize the appointment of a 
    Director of Digital Currency Security in the Office of Economic 
Sanctions Policy and Implementation of the Department of State, and for 
                            other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Russia Cryptocurrency Transparency 
Act''.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) On February 24, 2022, the Government of the Russian 
        Federation, led by Vladimir Putin, launched an unprovoked, 
        full-scale invasion of Ukraine.
            (2) This unprovoked act of aggression violates Ukraine's 
        right to independence, sovereignty, and territorial integrity, 
        and constitutes an emergency in international relations.
            (3) The invasion by the Government of the Russian 
        Federation of Ukraine caused significant displacement in 
        Ukraine and triggered a broader humanitarian crisis in Europe.
            (4) On March 23, 2022, the Department of State released a 
        statement assessing that the Russian Armed Forces committed war 
        crimes by launching indiscriminate attacks on civilians and 
        non-military infrastructure, including apartment buildings, 
        schools, and hospitals, leaving thousands of innocent civilians 
        killed or wounded.
            (5) The United Nations Office for Coordination of 
        Humanitarian Affairs has projected that, over the next three 
        months, 12,000,000 people living in Ukraine will need 
        humanitarian assistance, 6,700,000 people will be internally 
        displaced, and 4,000,000 people will flee Ukraine.
            (6) Rapid humanitarian assistance is necessary across 
        sectors to address the needs of refugees and internally 
        displaced persons from Ukraine.
            (7) Cryptocurrency has been used as an effective cross-
        border payment tool to send millions to the Ukrainian 
        Government, Ukrainian army, and Ukrainian refugees with limited 
        access to financial services.
            (8) In response to the war of aggression by the Government 
        of the Russian Federation, the United States has imposed an 
        array of sanctions, cutting off major Russian financial 
        institutions from Western markets and freezing the assets of 
        numerous Russian oligarchs.
            (9) Given the growing development and adoption of 
        blockchain technologies and digital currencies, there are 
        increasing concerns that digital assets, such as 
        cryptocurrencies, may be used to circumvent the United States 
        sanctions regime, as well as those of foreign countries.

SEC. 3. CONGRESSIONAL NOTIFICATION FOR REWARDS PAID USING 
              CRYPTOCURRENCIES.

    (a) In General.--Section 36(e)(6) of the State Department Basic 
Authorities Act of 1956 (22 U.S.C. 2708(e)(6)) is amended by adding at 
the end the following new sentence: ``Not later than 15 days before 
making a reward in a form that includes cryptocurrency, the Secretary 
of State shall notify the Committee on Foreign Affairs of the House of 
Representatives and the Committee on Foreign Relations of the Senate of 
such form for the reward.''
    (b) Report.--Not later than 180 days after the date of the 
enactment of this Act, the Secretary of State shall submit to the 
Committee on Foreign Affairs of the House of Representatives and the 
Committee on Foreign Relations of the Senate a report on the use of 
cryptocurrency as a part of the Department of State Rewards program 
established under section 36(a) of the State Department Basic 
Authorities Act of 1956 (22 U.S.C. 2708(a)) that--
            (1) justifies any determination of the Secretary to make 
        rewards under such program in a form that includes 
        cryptocurrency;
            (2) lists each cryptocurrency payment made under such 
        program as of the date of the submission of the report;
            (3) provides evidence of the manner and extent to which 
        cryptocurrency payments would be more likely to induce 
        whistleblowers to come forward with information than rewards 
        paid out in United States dollars or other forms of money or 
        nonmonetary items; and
            (4) examines whether the Department's use of cryptocurrency 
        could provide bad actors with additional hard-to-trace funds 
        that could be used for criminal or illicit purposes.

SEC. 4. AUTHORIZATION FOR DIRECTOR OF DIGITAL CURRENCY SECURITY.

    (a) Appointment.--Not later than 90 days after the date of the 
enactment of this Act, the Secretary of State shall appoint a Director 
of Digital Currency Security in the Office of Economic Sanctions Policy 
and Implementation.
    (b) Duties.--The Director appointed pursuant to subsection (a) 
shall be responsible for the following:
            (1) Reviewing and analyzing the manner and extent to which 
        digital currencies are impacting the United States sanctions 
        regime.
            (2) Assisting in the development of sanctions policy and 
        implementation that is resilient to the use of digital 
        currencies by malevolent actors.
            (3) Coordinating with the Office of Foreign Assets Control 
        and the Financial Crime Enforcement Network of the Department 
        of the Treasury, as appropriate, to share information and 
        develop best practices.
            (4) Engaging with private sector actors to broaden 
        understanding of the digital currency ecosystem, further 
        comprehend economic costs and benefits, and encourage 
        coordination and partnership in isolating bad actors.

SEC. 5. REPORT ON BLOCKCHAIN TECHNOLOGY USAGE TO ADDRESS UKRANIAN 
              HUMANITARIAN NEEDS.

    Not later than 30 days after the date of the enactment of this Act, 
the Secretary of State, in coordination with the Secretary of the 
Treasury and the Administrator of the United States Agency for 
International Development, shall submit to the Committee on Foreign 
Affairs of the House of Representatives and the Committee on Foreign 
Relations of the Senate an unclassified report on the possible uses of 
cryptocurrencies or other technologies incorporating blockchains to 
promote economic development and provide humanitarian aid to Ukraine. 
Such report shall also review and analyze ways in which technologies 
incorporating blockchains can--
            (1) assist in the care, support, or resettlement of 
        refugees and internally displaced persons from Ukraine;
            (2) address humanitarian access challenges and ensure the 
        effective delivery of such assistance to persons from Ukraine;
            (3) increase efficiency, accountability, and transparency 
        in the administration of humanitarian aid provided by the 
        United States to persons from Ukraine;
            (4) prevent corruption through the use of ``web3'' 
        technologies;
            (5) improve access to capital; and
            (6) bolster the efficiency and reliability of cross-border 
        remittances.

SEC. 6. REPORT ON THE EFFECTIVENESS AND ENFORCEMENT OF SANCTIONS.

    (a) Sense of Congress.--It is the sense of Congress as follows:
            (1) On March 9, 2022, President Biden issued an Executive 
        order outlining a national policy to mitigate the risks, and 
        harness the potential benefits of, digital assets and 
        distributed ledger technology.
            (2) The growing development and adoption of digital assets 
        have created an urgent need for the United States to play a 
        leading role in the global financial system and facilitate 
        technological innovation.
            (3) These developments have had significant implications 
        that pose risks to the financial stability and national 
        security interest of the United States, including issues 
        relating to privacy and surveillance.
            (4) The United States Government must--
                    (A) ensure the efficacy and enforcement of the 
                United States sanctions regime by preventing the misuse 
                of digital assets, which can facilitate transactions by 
                Russian persons subject to sanctions;
                    (B) mitigate national security liabilities and 
                systemic financial risks posed by the misuse of digital 
                assets by developing policy recommendations and 
                addressing existing regulatory gaps; and
                    (C) maintain technological leadership to promote 
                U.S. global competitiveness and play a leading role in 
                the global governance of digital assets.
    (b) Report.--
            (1) In general.--Not later than 30 days after the date of 
        the enactment of this Act, the Secretary of State, in 
        consultation with the Secretary of the Treasury, shall submit 
        to the appropriate congressional committees a report assessing 
        the manner and extent to which digital currencies can affect 
        the effectiveness and enforcement of United States sanctions 
        against the Russian Federation and against actors subject to 
        sanctions relating to the Russian Federation's invasion of 
        Ukraine.
            (2) Matters to be included.--The report required by 
        paragraph (1) shall--
                    (A) describe any efforts by the Russian Federation 
                or persons subject to sanctions related to the Russian 
                Federation's invasion of Ukraine to use digital assets 
                to evade the sanctions regime of the United States or 
                its international allies and partners;
                    (B) describe any efforts by persons subject to 
                sanctions related to the Russian Federation's invasion 
                of Ukraine to use decentralized finance technology or 
                other similar technology to effect transactions, 
                including digital wallets, digital asset trading 
                platforms, and digital asset exchanges;
                    (C) assess how the use or adoption of digital 
                currencies could undermine the national security 
                interests of the United States and impact the efficacy 
                and enforcement of sanctions and anti-money laundering 
                provisions;
                    (D) detail actions taken by the United States to 
                work with private sector actors to combat the evasion 
                of sanctions imposed by the United States; and
                    (E) include recommendations for new legislative and 
                regulatory measures needed to strengthen the ability of 
                the United States to prevent states, state-sponsored 
                actors, and non-state-sponsored actors from using 
                digital currencies to evade sanctions imposed by the 
                United States.
            (3) Appropriate congressional committees.--In this 
        subsection, the term ``appropriate congressional committees'' 
        means--
                    (A) the Committee on Foreign Affairs of the House 
                of Representatives;
                    (B) the Committee on Financial Services of the 
                House of Representatives;
                    (C) the Committee on Foreign Relations of the 
                Senate; and
                    (D) the Committee on Banking, Housing, and Urban 
                Affairs of the Senate.
            (4) Form.--The report required by paragraph (1) shall be 
        submitted in unclassified form but may include a classified 
        annex.
                                 <all>