A group of US senators, led by Senate Banking Committee Chair Tim Scott (R-S.C.), has introduced legislation aimed at modernizing the Bank Secrecy Act, which serves as the foundation of the country’s Anti-Money Laundering (AML) framework.
The Bank Secrecy Act, originally passed in 1970, mandates that banks, credit unions, and other financial institutions assist federal authorities in detecting and preventing financial crimes, such as money laundering, terrorist financing, and other illicit activities.
The proposed legislation, titled the STREAMLINE Act, seeks to raise the Bank Secrecy Act’s reporting thresholds for the first time in over 50 years.
Specifically, the bill proposes increasing the Currency Transaction Report (CTR) threshold from $10,000 to $30,000. It also aims to raise the Suspicious Activity Report (SAR) thresholds from $2,000 to $3,000 and from $5,000 to $10,000. Furthermore, the legislation requires the Treasury Department to adjust these amounts every five years to account for inflation. Under the current regulations, financial institutions are required to file CTRs for cash transactions exceeding $10,000 and SARs for transactions involving amounts between $2,000 and $5,000, depending on the level of suspicion or evidence of criminal activity.
Senator Pete Ricketts, a supporter of the bill, stated, "After more than 50 years of inflation, the Bank Secrecy Act’s reporting thresholds are badly outdated. They must be modernized.”
He further commented that the new bill “cuts red tape for banks and credit unions,” while ensuring that “law enforcement still has the tools they need to do their job.”
US-based cryptocurrency exchanges, including Coinbase and Kraken, are also obligated to adhere to the Bank Secrecy Act.
Industry Engagement and Legislative Efforts
As lawmakers consider broader financial regulations, industry groups are intensifying their policy engagement.
Recently, a coalition of fintech and crypto industry trade groups sent a letter to the US Consumer Financial Protection Bureau (CFPB). They urged the bureau to finalize an open banking rule that would affirm individuals, rather than banks, as the owners of their financial data.
Open banking, a system that enables consumers to share their financial data with third-party applications via APIs, plays a crucial role in connecting traditional finance with sectors such as decentralized finance (DeFi), crypto payment networks, and digital banking platforms.
Concurrently, Senate Democrats have been engaged in discussions with crypto industry leaders regarding the US market structure bill. This bill is the Senate's counterpart to the House's CLARITY Act, both of which aim to establish a unified federal framework for digital asset regulation. On Wednesday, Senator Kirsten Gillibrand, along with several other Senate Democrats, met with prominent figures from the crypto industry, including representatives from Circle, Ripple, Kraken, and Coinbase Chainlink.
According to a post shared by journalist Eleanor Terrett on X, “the senators as a group said they were committed to getting a bill done.”
The US government has been impacted by a shutdown since October 1st, marking the third-longest closure in US history. It is anticipated that a vote on the digital assets market structure bill will not occur until the government reopens.