During a hearing on March 5, held at the House Financial Services Committee, Representative Sean Casten expressed significant concerns regarding cryptocurrency-friendly regulations, arguing that these could threaten the national security of the United States.
These statements were released in the context of the debate on the “Taiwan Conflict Deterrence Act of 2025”, during which Casten criticized figures like President Donald Trump and entrepreneur Elon Musk for their support of such regulations.
Casten’s accusation: cryptocurrencies and the risk of Ransomware
Sean Casten pointed out that pro-crypto policies could make it “essentially impossible” to determine the origin of transferred funds, increasing the risk of illicit activities. He emphasized how 100% of ransomware attacks in the USA are funded through cryptovalute, highlighting the need to keep surveillance and anti-money laundering laws strict.
In response to Casten’s statements, Congressman Warren Davidson, known for his pro-cryptocurrency stance, defended the need to balance security and privacy. Davidson criticized Casten’s approach as eager for a “surveillance state”, comparable to the Chinese one, and emphasized the importance of adhering to the principles of the United States Constitution.
The warnings of Edward Snowden and the concerns about surveillance
The intervention of Edward Snowden, former contractor of the NSA, added another layer of complexity to the debate. Snowden warned that the NSA was close to gaining full control of the internet and expressed concerns regarding the expansions to section 702 of the Foreign Intelligence Surveillance Act (FISA).
This could, according to him, transform almost every individual into a government surveillance agent.
Holtzman’s viewpoint on decentralization
David Holtzman, former military intelligence professional, emphasized the importance of decentralization as a method to counter the growing authoritarian threats related to surveillance through artificial intelligence. Holtzman highlighted how the centralization of blockchains and AI can pose an unprecedented threat in human history.
The debate between the need for national security and the protection of personal privacy continues to be a hot topic in the context of emerging technologies such as cryptocurrencies. While some legislators like Sean Casten see pro-crypto regulations as a potential security risk, others, like Warren Davidson, defend individual freedom and privacy as fundamental pillars of American society.
The tension between government surveillance and decentralization remains a crucial point of discussion for the future of digital security and individual sovereignty.
Source: https://en.cryptonomist.ch/2025/03/06/the-pro-crypto-regulations-and-national-security-concerns-the-case-of-representative-sean-casten/