A new U.S. bill turns the heat up on crypto scams — what that could mean for markets and investors

Why this bill matters now — and how it could change the market

Congress has moved a new bill aimed squarely at crypto scams and fraud. If it becomes law, the SAFE Crypto Act would tighten the rules around who can store and move digital assets, and who must report suspicious activity. That sounds like a win for consumers. It also matters for anyone holding crypto, trading on an exchange, or owning funds tied to tokens — because the rules would reshape how custodians, exchanges and asset managers operate, and that will ripple into costs, liquidity and volatility.

The headline here is simple: the bill would turn a big piece of the U.S. government into a more active cop on the beat. For markets, that means both a higher barrier to bad actors and a higher cost for firms that want to play by the rules. Investors should treat this as a structural change — one that raises compliance bills now but may reduce scam-driven crashes over time.

What the SAFE Crypto Act would actually require

At its core, the bill targets fraud and anonymous movement of funds. It would do this by expanding the legal definitions that matter to regulators — who counts as a crypto business, what counts as a custodial wallet, and what kinds of transactions trigger reporting.

Under the bill, more firms would be treated like regulated financial businesses. That means exchanges, custodians, certain wallet providers and some infrastructure services would face rules similar to banks: customer checks, recordkeeping, suspicious activity reports, and stronger know‑your‑customer (KYC) steps. The aim is to cut off easy ways for scammers to move stolen funds or to hide behind anonymous wallets.

The bill would also set clearer definitions of covered assets. Rather than leaving token status vague, it would draw lines that determine when a token and the firms that touch it fall under anti‑fraud and anti‑money‑laundering rules. That matters because it reduces legal uncertainty for firms that want to comply — and it forces marginal players to upgrade or step out.

Consumer protections get a lift too. The bill includes provisions to make it harder for bad actors to run big, fake token sales and pyramid schemes. It would require better disclosure for token offerings and give regulators clearer authority to claw back funds in some scams. For custodians, the bill adds layered recordkeeping and custody rules designed to ensure customers’ private keys and assets are handled with transparent controls.

Finally, the bill pressures intermediaries. Third‑party service providers that enable transfers, listings, or marketing would face due‑diligence requirements. That creates a compliance chain: exchanges and custodians have to vet partners, and that reduces where scammers can operate easily.

Which agencies gain new authority — and how they’ll work together

The bill hands clearer and expanded tools to several agencies. Treasury and its Financial Crimes Enforcement Network (FinCEN) would get a lead role in setting rules for anti‑money‑laundering checks and reporting standards for crypto firms. Expect new guidance that spells out what kinds of on‑chain monitoring and recordkeeping are required.

The Department of Justice would get reinforced powers for criminal prosecutions tied to scams and thefts. That could speed up seizures and prosecutions for large frauds. The Secret Service — already involved in financial crime — would get clearer authority to investigate and disrupt large‑scale illicit uses of crypto, including coordinated efforts to launder money across multiple platforms.

Coordination between agencies is a big focus. The bill pushes for joint rulemaking and data sharing so FinCEN, Treasury, DOJ and law‑enforcement partners can move quickly when bad actors use cross‑border or decentralized tools. In practice, that will include task forces and shared intelligence feeds that combine on‑chain analytics with traditional financial data.

Timelines in the bill would likely give agencies months to produce rules after passage. Expect a phased rollout: initial guidance and enforcement priorities first, then formal rulemaking and compliance deadlines over the following year. That staged approach gives firms time to upgrade systems, but it also creates a period of regulatory uncertainty where enforcement focus will shape market behavior.

How this could move prices, exchanges and crypto investment products

Start with the obvious: higher compliance costs for exchanges, custodians and fund managers. Big, regulated players such as Coinbase (COIN) and asset managers that shortlist crypto products could face increased security and reporting costs. Some of those costs will be passed to customers through higher fees, narrower spreads or less generous custody terms.

For listed products and trusts, the effect is mixed. Tighter rules reduce the chance of headline‑grabbing scams that can wipe out confidence and cause sharp price crashes. That should make institutional appetite steadier over time, supporting flows into regulated vehicles. On the other hand, firms that can’t or won’t meet the new standards may delist tokens or remove fiat on‑ramps, which would reduce liquidity for affected assets and could increase short‑term volatility.

Custodians and wallet providers will face a crossroads: invest in compliance and gain access to mainstream dollars, or stay outside the regulated world and risk losing business as banks and payment partners step back. That will push some institutional flows toward regulated custodians and ETPs run by large asset managers, which benefits firms with scale — think of how big managers moved into spot Bitcoin funds before. BlackRock (BLK) and other large asset managers could see demand for compliant, custody‑backed products if the law reduces scam risk.

Smaller tokens and anonymous protocols are the most vulnerable. Expect project teams with weak governance or opaque token economics to suffer price pressure and delistings. Mainstream, well‑audited projects should be less affected — and could even gain market share as risk‑averse funds favor safer assets.

Practical steps and watch points for investors as the bill moves

Take a few practical steps now. First, check who holds custody for your crypto and what their compliance posture is. If you use an exchange, read its AML/KYC updates and fee notices. If you self‑custody, understand the tradeoff: privacy versus regulatory protection.

Second, watch enforcement cues closely. Look for high‑profile actions: asset freezes, civil complaints, or multi‑agency announcements. Those signal where regulators will focus resources and which token types are in trouble.

Third, monitor rulemaking from Treasury/FinCEN and DOJ statements. Expect initial guidance within months after passage and formal rules to follow over the next 6–18 months. Fund managers and custodians will publish compliance roadmaps; those are useful signals about who will absorb the cost and who might bow out.

Finally, keep an eye on liquidity and listings. If major exchanges restrict deposits or delist assets, prices can gap quickly. Funds and trusts with audited custody — including listed trusts such as GBTC (GBTC) — could see interest if the law reduces scam risk and shifts flows to regulated products.

In short: the SAFE Crypto Act is aimed at reducing scams, and that is good for long‑term stability. But it raises costs and concentrates power among firms that can meet tougher rules. For investors, that mix means less room for shady players — and less clarity for risky, small projects. Adjust expectations accordingly and watch enforcement signals closely.

Sources

• slotkin.senate.gov
• moran.senate.gov
• cointelegraph.com
• cointelegraph.com
• cointelegraph.com
• cointelegraph.com