The Republican senator on a crusade against crypto

Sen. Roger Marshall, R-Kan., isn’t graded yet on the cryptocurrency industry’s big scorecard. But at this point, he’d be happy to flunk it.

“Even when you talk to the crypto people, people who support it readily admit that more than half of the cryptocurrencies out there are bad actors that take advantage of people,” Marshall told Semafor in a recent interview.

“The deeper I dive into this rabbit hole, the more concerns I have,” he added.

Comments like those have set Marshall apart from the rest of his party when it comes to the issue of crypto. While several Democrats have taken to openly savaging the industry in the wake of its recent scandals, the deeply conservative Kansan is the first GOP senator to have openly joined the ranks of crypto skeptics.

In what’s perhaps the unlikeliest duo on crypto legislation so far, Marshall and Sen. Elizabeth Warren, D-Mass. rolled out a bill on Dec. 16 designed to crack down on digital assets that are used for money laundering. It would also require crypto exchanges to verify client information in a similar manner as banks, and impose other rules the financial industry already plays by.

Marshall told Semafor that Warren called shortly after he assailed crypto as a national security threat and unexpectedly said the government should impose a moratorium on all trading during a Senate Agriculture hearing on Dec 2. Warren pitched her plan afterward, and they drafted the legislation together. Thus was born the chamber’s latest legislative odd-couple.

His views have been shaped in part by conversations with national security officials at U.S. embassies during overseas trips with Congressional delegations. Marshall said they’re increasingly sounding the alarm about the use of digital tokens to facilitate sanctions evasion by rogue nations, human trafficking, and drug trafficking.

“Every one of them brings this issue up within a matter of minutes,” he said.

As for other Republicans? Marshall thinks some of his GOP colleagues quietly share his concerns — but wouldn’t name names. “Anybody that’s spoken to any national security folks realize what a huge concern this is,” he said.

Warren is certainly trying to bring more of them out of the woodwork. “[Marshall] may be the first, but I’m sure he’s not the last to say out loud how risky unregulated crypto is,” she told Semafor. During a recent Capitol Hill train ride, she seized an opportunity to make a 60-second elevator pitch about her work with Marshall to Sen. Tim Scott, R-SC., the incoming ranking member of the powerful Senate Banking Committee. She stressed it’s all about ensuring “everyone plays by the same rules.”

“I look forward to seeing y’all’s work,” Scott replied. He currently has a B on the industry’s scorecard.