Seth Hertlein, the Global Head of Policy at Ledger, a provider of digital asset wallets, stated that the 'Keep Your Coins Act' should not be necessary. He argued that the Constitution already safeguards Americans' right to private property. The act was introduced by U.S. Rep. Warren Davidson (R-Ohio) with the aim of preserving crypto users' ability to transact without involving a third-party intermediary.
According to Hertlein, "Well, it really shouldn’t be necessary at all. Self-custody is just a fancy name for property rights. The right to private property was inherited from British common law and existed here before the founding of this country. The U.S. Constitution protects private property in two ways: the Fifth Amendment states that 'No person shall . . . be deprived of life, liberty, or property, without due process of law,' and the Tenth Amendment states 'The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people', meaning that all rights not specifically delegated to the federal government remain with the people, including common-law private property rights."
In his statement in the Jan. 5 edition of Cap Hill Crypto newsletter, Hertlein pointed out that although self-custody of digital assets should be considered as protected under the Constitution, certain legislation and proposals seem to threaten Americans' ability to store their own digital assets. He cited DAAMLA (Digital Asset Market Structure and Investor Protection Act), Treasury's broker reporting rule proposal and Financial Crimes Enforcement Network's (FinCEN) self-hosted wallet proposal as examples.
"The Keep Your Coins Act is important because it would end all these infringements of peoples’ rights by simply reiterating in plain language what the Constitution already says: that citizens have the right to hold and use digital property just like any other property," Hertlein said. He also mentioned that the only objections to the bill he is aware of are "vague" concerns about restricting the federal government's power over self-custody.
Founded in 2015, Ledger provides hardware wallets for storing digital assets such as cryptocurrencies and Non-Fungible Tokens (NFTs), according to its official website.
Prior to joining Ledger, Hertlein served as Head of Policy and Government Relations for Stellar Development Foundation, overseeing global engagement on crypto policy and regulation. This information was provided by a press release from the Pennsylvania Blockchain Coalition (PBC). A member of the Blockchain Association, Hertlein previously served on the Leadership Committee of the Chamber of Digital Commerce’s Token Alliance. In May 2022, he was appointed Advisory Board Chair for PBC.
Hertlein warned in his newsletter that Treasury's recently proposed rule for digital asset brokers could expand the definition of "broker" to such an extent that it effectively bans decentralized networks. He stated, "The bottom line is that if the rule is adopted as proposed, then Ledger and other self-hosted wallet providers will have a very difficult choice to make: either withdraw entirely from the U.S. market or fundamentally change the product."
Davidson initially introduced 'Keep Your Coins Act' in February 2022, according to a press release from his office. The bill aims to prevent federal agencies from enacting rules that obstruct individuals from acting as self-custodians of their digital assets. Davidson said at that time, "It’s vital that we preserve the attributes of cash transactions by protecting the permissionless nature of cash," adding that "No third party should be required for two people (or companies) to use money as a means of exchange, store of value, and record of account."
The bill was approved by the House Financial Services Committee earlier this year with a 29-21 vote along party lines, as reported in the newsletter.
