Coinbase calls on the U.S. Treasury to restructure anti-money laundering rules through technological innovation and promote a "safe harbor" for AI and blockchain analysis

ChainCatcher news, Coinbase submitted a 30-page opinion to the U.S. Treasury, stating that the Bank Secrecy Act (BSA) and related rules are outdated, inefficient, and increase data exposure. The company suggests establishing a "safe harbor" for compliance tools using AI and APIs for monitoring, recognizing decentralized IDs and zero-knowledge proofs as methods for customer verification, and promoting "Know Your Transaction" (KYT) on-chain analysis as superior to traditional suspicious activity reports.

Coinbase proposed strengthening public-private collaboration through a regulatory sandbox to reduce low-value reporting in a results-oriented manner. This proposal contrasts with the recent Senate Democrats' draft concerning DeFi, which has been criticized for "effectively banning" DeFi and wallet development.