According to a report by CoinDesk, US lawmakers introduced a new bipartisan bill on Wednesday (8th) that prohibits government officials from conducting business with Chinese blockchain companies and explicitly forbids officials from trading with iFinex, the parent company of Tether, the issuer of the stablecoin USDT.
The bill, called the “Creating Legal Accountability for Rogue Innovators and Technology” (CLARITY) Act, is co-led by Republican Congressman Zach Nunn and Democratic Congresswoman Abigail Spanberger. According to a press release, the bill aims to prevent the government from utilizing blockchain network infrastructure, blockchain service providers, and distributed ledger technology developed by China and other foreign adversaries. It also instructs the US Treasury Secretary, Secretary of State, and Director of National Intelligence to develop a plan to “mitigate the risks posed by the development of blockchain technology by China and other foreign adversaries.”
The legislation aims to ensure that foreign adversaries do not have backdoor access to critical national security intelligence and Americans’ privacy information. Congressman Nunn, a freshman member of the House, stated that the bill also prohibits US officials from trading with development companies behind The Spartan Network, The Conflux Network, and Red Date Technology Co., the company behind China’s National Blockchain Project and central bank digital currency.
The bill’s sponsors are not part of the House leadership and do not hold key positions in committees. Other more senior lawmakers have been pushing for multiple cryptocurrency bills, some of which also involve security issues. Some bills have already received approval from the full House Committee and are further advancing, so the new bill is unlikely to preempt them.
Prior to these restrictions, lawmakers had previously banned government employees from using the social media app TikTok, citing security concerns. Earlier this year, a former executive of TikTok’s parent company, ByteDance, alleged in court documents that the Chinese Communist Party used a secret “backdoor” in their social media platform to monitor the location and messages of Hong Kong activists in 2018. ByteDance strongly denied these allegations.
