Key takeaways
- Senators Cynthia Lummis and Ron Wyden introduced a bill to exempt non-custodial blockchain developers from being classified as money transmitters.
- The bill clarifies that developers who do not have control over user funds should not fall foul of federal money transmitter laws.
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U.S. Senators Cynthia Lummis and Ron Wyden on Monday unveiled the Blockchain Regulatory Certainty Act, bipartisan legislation that would exempt non-custodial blockchain developers and infrastructure providers from federal money transmitter rules.
The bill aims to protect innovation, maintain consistency with federal guidelines, and prevent non-custodial developers from being treated like banks or financial intermediaries.
Under the proposal, developers who write software, maintain distributed ledgers or provide supporting infrastructure, but do not control user funds, would not be treated as money transmitters under federal law.
“Blockchain developers who simply wrote code and maintained open source infrastructure have lived under the threat of being classified as money transmitters for too long,” said Lummis, who chairs the Senate Banking Digital Assets subcommittee.
“This designation is meaningless when they never touch, control or have access to user funds, and unnecessarily limits innovation,” she said.
Wyden framed the issue in terms of constitutional rights. “Forcing developers who write code to follow the same rules as exchanges or brokers is technologically illiterate and a recipe for violating Americans’ privacy and free speech,” he said.
The legislation also aims to harmonize federal standards with state laws while providing regulatory certainty to boost America’s digital financial sector.
Under current law, many developers face regulatory uncertainty that has driven innovation overseas and subjected them to conflicting state rules.
The legal threshold for developer liability has reached a turning point in the recent lawsuits against Tornado Cash and Samourai Wallet. In these cases, prosecutors have successfully argued that maintaining and governing the code can qualify developers as “financial institutions,” subjecting them to the Bank Secrecy Act in the same way as traditional banks.
Tornado Cash co-founder Roman Storm was convicted in 2025 of conspiracy to operate an unlicensed money transmitting business, while Samourai Wallet founders Keonne Rodriguez and William Lonergan Hill pleaded guilty to similar charges.
Members of the crypto community say these findings represent a dangerous precedent, effectively criminalizing the act of publishing privacy-preserving software.
