In response to a deluge of comments, the Anti-Money Laundering office of the US Treasury Department is delaying a hasty proposal to track a whole new series of cryptocurrency transactions.
On Thursday, the Treasury’s Financial Crimes Enforcement Network, or FinCEN, announced that it is the comment box in response to a line originally announced two days before Christmas and less than a month before a new administration takes over.
The originally proposed rule aimed to add new thresholds for registered money services – i.e. crypto exchanges – that conduct transactions with self-hosted wallets, which are only identifiable by their keys. The proposal provoked one turmoil of the cryptocurrency community, which saw it as a violation of the principles of peer-to-peer transactions and the procedural rules applicable to US regulators.
The original commentary period was extended by only 15 days, many of which were holidays. Today’s extension represents a huge win for the crypto industry. According to the firm’s account, “FinCEN values the robust responses already provided by commenters and has reviewed more than 7,500 responses submitted during the NPRM’s original response period.”
With the inauguration of Joe Biden in just six days, the Treasury leadership is likely to see a major change of guard. Few predict Janet Yellen, Biden’s nominee to replace current Treasury Secretary Steven Mnuchin, to be just as aggressive about such transactions.
FinCEN appears to have given special credence to arguments that there are different thresholds between applying banking style clauses to cash transactions as opposed to foreign transaction-level thresholds for crypto wallet exchanges. Currently, a bank has a duty to report any cash withdrawal or deposit in excess of $ 10,000. Meanwhile, the infamous Travel Rule mandates that any transaction over $ 3,000 entering or leaving the United States must pass identifying information about the transactions.
As a result, FinCEN is giving 15 days to respond to the $ 10,000 threshold and an additional 45 to respond to the $ 3,000:
FinCEN will provide an additional 15 days for comments on proposed reporting requirements regarding information on CVC or LTDA transactions greater than $ 10,000, or aggregated to more than $ 10,000, involving unhosted wallets or wallets hosted in jurisdictions identified by FinCEN. FinCEN will provide an additional 45 days for comments on the proposed requirements that banks and MSBs report certain information about counterparties to transactions by their hosted wallet customers, and on the proposed record keeping requirements. “
FinCEN had not responded to Cointelegraph’s request for comment at the time of publication.
Joining the proposed crypto vigilance thresholds was another new proposal from FinCEN that would be required disclosure of offshore crypto accounts with more than $ 10,000.