US Lawmakers Want to Ban Chinese Blockchains

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  • US lawmakers have created a bill seeking to block government agencies and officials from interacting with blockchain projects with Chinese roots
  • The lawmakers have mentioned Tether’s creator as one of the projects they’d like to block usage
  • They’ve also expressed their suspicion about China’s heavy investment in blockchain technology

The fear of China sniffing around the United States’ security has increased with some US lawmakers suggesting that US agencies and officials should be outlawed from using blockchain projects developed by Chinese entities. The lawmakers have singled out Tether’s creator iFinex as one of the blockchain and crypto companies US government officials should cut ties with. They also seemed uncomfortable with China’s heavy investments in blockchain technology, which is unclear whether the lawmakers lament being left behind in adopting the technology or if it genuinely has some security complications.

Foreign Adversaries can Indirectly Access Data?

Through the Creating Legal Accountability for Rogue Innovators and Technology (CLARITY) Act, Abigail Spanberger and Zach Nunn, two US Representatives, also want to prohibit government entities from interacting with technologies that power crypto trading outlets such as exchanges with Chinese links.

According to Spanberger and Nunn, erecting such restrictions will prevent “foreign adversaries” from indirectly getting hold of the private data of Americans and also accessing the country’s security intelligence.

The lawmakers also observed that it’s likely that “every American” will have a piece of their sensitive data stored using the decentralized technology in coming years, adding that China may be angling to access the data with its continued commitment to invest in decentralized technology.

No TikTok for Government Officials

The bill comes months after the White House blocked government officials from using the popular China-linked social app TikTok. It also comes a day after the US consumer protection agency disclosed plans to supervise crypto wallets.

Although China has banned crypto activities within its borders, it has embraced the technology that underpins cryptocurrency and recently announced a national blockchain center. The country has also supported blockchain-based technologies such as the metaverse and NFTs and intends to create a metaverse-based digital identity system.

Despite increasing fears that China is a threat to the United States’ national security, China leads the US in blockchain adoption.