FinCEN withdraws proposals to tighten rules on crypto mixers and self-hosted wallets
FinCEN, an agency of the U.S. Treasury Department, has withdrawn two controversial crypto regulatory proposals: a rule that would have classified international crypto mixing activity as a “primary money laundering concern,” and a 2020 proposal that would have required financial institutions to keep records and verify identities for transactions involving self-hosted wallets.
FinCEN said the broad definition of crypto mixing could have had a “chilling effect” on legitimate privacy-preserving activities while imposing significant reporting burdens on financial institutions. The 2020 self-hosted wallet proposal was also fully withdrawn.
The move does not change existing legal obligations, but signals a shift in the U.S. approach to crypto toward reducing broad surveillance requirements involving personal wallets and legitimate privacy-preserving activity.
FinCEN, an agency of the U.S. Treasury Department, has withdrawn two controversial crypto regulatory proposals: a rule that would have classified international crypto mixing activity as a “primary money laundering concern,” and a 2020 proposal that would have required financial institutions to keep records and verify identities for transactions involving self-hosted wallets.
FinCEN said the broad definition of crypto mixing could have had a “chilling effect” on legitimate privacy-preserving activities while imposing significant reporting burdens on financial institutions. The 2020 self-hosted wallet proposal was also fully withdrawn.
The move does not change existing legal obligations, but signals a shift in the U.S. approach to crypto toward reducing broad surveillance requirements involving personal wallets and legitimate privacy-preserving activity.