Referred to the House Committee on Financial Services.
This bill (CODE Act of 2025) requires the Secretary of the Treasury to create a time-limited public-private partnership (PPP) to test and develop technological anti-money-laundering (AML), sanctions, identity verification, and cybersecurity controls for decentralized finance (DeFi) smart contracts on public blockchains. The PPP must test integrating such controls into smart contracts, consider a regulatory gateway for verifiable external data, and issue legislative and regulatory recommendations; participants controlled by certain senior officials or their relatives are excluded.
Privacy and decentralization vs.
Relative to its intended legislative type, this bill functions primarily as a substantive policy change with study/reporting and administrative elements; it provides clear problem framing and deadlines but leaves substantial operational, fiscal, and accountability specifics to subsequent agency action.
This bill (CODE Act of 2025) requires the Secretary of the Treasury to create a time-limited public-private partnership (PPP) to test and develop technological anti-money-laundering (AML), sanctions, identity verification, and cybersecurity controls for decentralized finance (DeFi) smart contracts on public blockchains.
The PPP must test integrating such controls into smart contracts, consider a regulatory gateway for verifiable external data, and issue legislative and regulatory recommendations; participants controlled by certain senior officials or their relatives are excluded.
The Financial Crimes Enforcement Network (FinCEN) must publish an advisory within 18 months, and the Treasury must issue a rule within 30 months defining key DeFi terms and requiring DeFi services to implement risk-based AML and sanctions compliance programs under the Bank Secrecy Act.
On content alone the bill is a targeted regulatory modernization effort with modest direct fiscal impact and time‑limited pilot provisions, which improves its chance relative to sweeping statutory rewrites. Nevertheless, it addresses a polarized sector (DeFi/crypto), mandates binding rulemaking with broad definitional discretion for Treasury, and may trigger organized opposition from privacy/decentralization proponents and some industry actors. Those factors lower its overall probability of enactment absent substantial stakeholder compromise or broad bipartisan support.
Relative to its intended legislative type, this bill functions primarily as a substantive policy change with study/reporting and administrative elements; it provides clear problem framing and deadlines but leaves substantial operational, fiscal, and accountability specifics to subsequent agency action.
Privacy and decentralization vs. AML/enforcement: liberals worry about surveillance and equity impacts; conservatives worry about centralization and freedom; centrists focus on tradeoffs and technical feasibility.
These are examples from the analysis, not a ranked list of the most-affected groups.
Privacy and decentralization vs. AML/enforcement: liberals worry about surveillance and equity impacts; conservatives worry about centralization and freedom; centrists focus on tradeoffs and technical feasibility.
A mainstream progressive would likely view the bill as a step toward reducing illicit finance, strengthening cybersecurity, and closing regulatory gaps in a fast-moving finance sector — outcomes broadly aligned with public safety and consumer protection goals.
They would be concerned, however, about privacy, surveillance, and potential disproportionate impacts on marginalized people who rely on privacy-preserving financial tools.
They would also want guardrails to ensure equitable access, civil liberties protections, and transparency about how identity and monitoring tools are designed and used.
A pragmatic moderate would see the bill as a reasonable, measured attempt to bring regulatory clarity to a rapidly evolving sector while testing technical compliance solutions through a limited pilot.
They would appreciate the interagency consultation, the PPP’s short sunset, and the timeline for rulemaking, but would want clearer definitions, cost estimates, and guardrails to avoid unintentionally stifling innovation.
The centrist would generally favor the bill if it includes measurable performance metrics, transparent timelines, and provisions to limit regulatory uncertainty for businesses and developers.
A mainstream conservative would likely be skeptical of this bill because it expands federal regulatory involvement into permissionless blockchain systems and could impose heavy compliance costs that undermine innovation and individual financial freedom.
They would emphasize risks of federal overreach, centralizing control of decentralized networks, and the possibility of driving activity and talent overseas.
Some conservatives may accept targeted AML and sanctions enforcement for national security reasons, but many will view the bill’s requirements and uncertain scope as disproportionate and potentially harmful to free-market technology development.
Reached or meaningfully advanced
Reached or meaningfully advanced
Still ahead
Still ahead
Still ahead
On content alone the bill is a targeted regulatory modernization effort with modest direct fiscal impact and time‑limited pilot provisions, which improves its chance relative to sweeping statutory rewrites. Nevertheless, it addresses a polarized sector (DeFi/crypto), mandates binding rulemaking with broad definitional discretion for Treasury, and may trigger organized opposition from privacy/decentralization proponents and some industry actors. Those factors lower its overall probability of enactment absent substantial stakeholder compromise or broad bipartisan support.
The bill has not accumulated any surfaced votes yet.
Privacy and decentralization vs. AML/enforcement: liberals worry about surveillance and equity impacts; conservatives worry about centraliz…
On content alone the bill is a targeted regulatory modernization effort with modest direct fiscal impact and time‑limited pilot provisions,…
Relative to its intended legislative type, this bill functions primarily as a substantive policy change with study/reporting and administrative elements; it provides clear problem framing and deadlines but leaves substa…
Go beyond the headline summary with full stakeholder mapping, legislative design analysis, passage barriers, and lens-by-lens tradeoff breakdowns.