House Proposal Prohibits Agencies Use Of Blockchain Tech Tied To China
Bipartisan legislation passed last week would limit the federal government's ability to buy or use blockchain technology from entities linked to the Chinese Communist Party and other foreign adversaries that pose a national security threat.
Law passed on November 8 by Congress. Introduced by Abigail Spanberger, a Virginia Democrat, and Zach Nunn, an Iowa Republican, it is intended to address cybersecurity concerns related to the use of technology by government-linked Chinese companies.
In his statement, Nunn added that the Chinese government's "major investment" in blockchain technology "poses a significant national security and data privacy challenge."
“Our bipartisan bill will ensure that the federal government does not provide China with a back door to access Americans' critical national security intelligence and personal information,” Nunn said.
Spanberger added that the bill would help “preserve the firewall between the CCP blockchain and the federal government, counter the influence of the Chinese Communist Party on the global economy, and protect our nation's competitiveness.”
Under the proposed legislation, federal agencies would not be permitted to “obtain, enter into, renew, or renew any contract or other agreement” for any “proprietary distributed ledger technology or blockchain equipment or services.”
The bill specifically lists five companies with ties to Chinese companies that are prohibited from selling blockchain technology and services to the US government. The list includes iFinex Inc., the parent company of the Tether stablecoin. include.
Within 180 days of the bill's passage, the Secretary of the Treasury, the Secretary of State, and the Director of National Intelligence will also be required to report to Congress on the risks associated with these technologies and services.
This report will assess, in part, the risks associated with “transactions using distributed ledger technology and blockchain hardware or services, including evasion of U.S. sanctions and international sanctions by the Society for Worldwide Interbank Financial Telecommunications (commonly referred to as SWIFT). Payment system " .
Lawmakers from both parties have raised concerns in recent years about the use of Chinese-made technology and tools to gain unauthorized access to Americans' personal information, corporate intellectual property and critical infrastructure services.
Members of the Senate Energy and Natural Resources Committee complained at a March hearing about the government's failure to identify the number of Chinese-made components in the U.S. power grid, calling it an inherent vulnerability in a cyber attack that could be exploited. attack
Popular video app TikTok, owned by Chinese parent company ByteDance, has also drawn the attention of state and federal officials over concerns that Beijing may have access to the personal information of American users. The federal government and even some states have taken steps to prevent employees from using the app on their official devices, but this has not completely mitigated the risk.
A spring audit of government-issued devices used by U.S. Immigration and Customs Enforcement employees and contractors found that employees were downloading prohibited software to foreign adversaries on government or government-related systems.
But supporters of the bill say the use of potentially sensitive blockchain technologies poses a greater national security risk than foreign ownership of popular apps.
“If we don't act now, it will be a disaster 1,000 times worse than the Chinese takeover of TikTok,” Nunn said.
