🔴The Promoting Innovation in Blockchain Development Act of 2026, a new bipartisan bill introduced yesterday, would protect developers from inappropriate misclassifications as money service intermediaries, clarifying that "Section 1960 applies only to those that control customer assets and transmit funds on behalf of customers," the Defi Education Fund states.
While the regulatory agency FinCEN had issued guidance on custody of assets being a necessary prerequisite for developers to be held criminally liable for money service business activity, courts have ruled FinCEN's guidance irrelevant in the criminal cases against Tornado Cash developers Roman Storm and Roman Semenov, as well as Samourai Wallet developers Keonne Rodriguez and William Hill.
As the legislative landscape stands in the US today, no law sufficiently protects non-custodial developers from criminal charges under Section 1960.
The Act is not yet published on congress[.]gov, and it remains to be seen how it differs from the Blockchain Regulatory Certainty Act, which is part of proposed market structure legislation currently being debated in the Senate, but has also been introduced as a stand-alone bill.
While market structure drafts would thereby include protections for non-custodial developers, they largely leave unclear what constitutes sufficient control over a service, and include many provisions that could drastically increase the surveillance users of non-custodial services are subjected to.
The introduction of stand-alone bills to protect developers can fast track these protections independent of market structure outcomes.
