To the Honorable Senator Feinstein,

I respect all that you have done and are doing to ensure the safety and security of
American citizens. As a lifelong resident of this great state, I also admire the great amount of
work you have done to protect and preserve the Californian way of life. Personal freedom and
security are two values I hold in the highest esteem, and I know for a fact that many other people
of this state and country do as well.

I am writing this letter because I read your comments on US Bill S.1241 - Combating
Money Laundering, Terrorist Financing, and Counterfeiting Act of 2017. As you know, this bill
would require people entering or exiting the United States to disclose any cryptocurrency
holdings over $10,000 in value. You were quoted as being in support of this bill, stating that:

Terrorist groups like ISIL and other transnational criminal organizations wouldnt be able to
finance their activities without illegal funds. Blocking these funds is an effective way to disrupt
these organizations and prevent crime and terrorism. Our bill adopts many of the
recommendations made by the Justice Department to ensure that transnational criminal
organizations, including terrorist groups, face consequences for laundering illicit funds, evading
laws and promoting criminal activity.

I am in full agreement with you that blocking fund transfers from terrorists groups is an
important endeavor. However, I am regretfully informing you that this bill would do nothing of
the sort. Cryptocurrencies such as Bitcoin, and blockchain technology in general, by nature
cannot be regulated in the same way that traditional currencies have. They carry with them a
great potential for anonymity, as any organization that utilizes them terrorist or otherwise
would know.

I feel that it is my responsibility to point out a fatal loophole in this potential law:
ensuring that people accurately disclose their cryptocurrency holdings is simply impossible. Any
person can create any number of accounts that cannot be traced back to them. If someone
wanted, they could provide border authorities with the information of a few accounts with small
amounts of money, and omit the ones with larger amounts of money.

There are more flaws in this potential law. Although regular citizens may willingly
disclose their cryptocurrency holdings, people with criminal intentions simply will not, and there
will be no way to tell the difference. At the very least, a criminal could cross the border without a
penny of cryptocurrency in any of their accounts. Once they cross the border, however, they
could instantly create a new anonymous cryptocurrency account with ease. Then they could
share their account address with someone from their criminal organization in another country
and have any amount of money sent to the new account in a matter of minutes or hours. The
criminals could take a few steps to ensure that the new account cannot be traced back to them.
 I understand why lawmakers are eager to control cryptocurrency. It is a new technology
that has so far been exempt from the regulations placed on traditional currency. As such, it has a
very high potential for being used in illegal activities. However, the very reason for its existence
is that it cannot be regulated by a central authority. By nature, everything about it is
decentralized. Nothing can even happen on cryptocurrency networks without the agreement of
many different parties from all over the world. Even if some cryptocurrencies such as Bitcoin are
not completely anonymous, there are others, such as Monero or Zcash, which are impossible to
track in the way that government and banking establishments are accustomed to doing.

I urge you to put more effort into understanding this new technology blockchain
which will only become a hotter topic for political debate. There is no law that can be passed that
will make it go away, and no law that can be passed that will change how it fundamentally
works. If it is the governments responsibility to protect peoples freedom, then the first step is to
fully understand the freedom that blockchain technology provides.

Sincerely,

Sheridan Babcock