And also regulated the same way as anything else. If you’re operating as an unlicensed money transmitter, you can’t pretend that it’s legit because your ledgers are printed and therefore protected by the First Amendment. Same applies to “but it’s just code”.
It's basically saying "if you've made a pull request to the bitcoin-core codebase, even just as a bugfix, you may be responsible for providing KYC'd information on all users of Bitcoin and on all Bitcoin transactions, regardless of where they happen or what your relationship to those people is".
Which is why the entire crypto ecosystem is up in arms. This bill is an extreme over-reach and would threaten the viability of essentially all crypto startups in the entire US.
It also may apply to other non-crypto digital money, although that might be the point of the bill, since it would allow the US more easily to chase anyone evading its sanctions (for example: China is creating digital currency, Iran has some ideas too, they could use this to ignore SWIFT and thus ignore sanctions, this bill would allow US to sanction that thing too)
Money transfer fraud also goes all the way back to "steamship agents" in the early 20th century. See, e.g., https://digital.library.temple.edu/digital/collection/p16002...