FinCEN Drops Two Crypto Rules Amid Deregulation Push
The Financial Crimes Enforcement Network (FinCEN) has withdrawn two proposed rules targeting cryptocurrency transactions involving unhosted wallets and virtual currency mixing. The move follows public feedback and aligns with the Trump Administration’s deregulatory efforts to ensure digital asset regulations are 'fit-for-purpose.'
One withdrawn rule, proposed in December 2020, would have required banks and money services businesses to collect and retain information on certain transactions involving convertible virtual currency (CVC) and unhosted wallets. The proposal included additional recordkeeping and identity-verification requirements for transactions exceeding $3,000 and reporting requirements for those exceeding $10,000.
FinCEN is also withdrawing its October 2023 proposal to designate CVC mixing as a class of transactions of 'primary money laundering concern.' This proposal would have used FinCEN’s special measures authority to require financial institutions to report information involving transactions connected to CVC mixing, which can obscure the source, destination, or amount of digital asset transactions.
Both withdrawals are scheduled for publication in the Federal Register on October 6, 2026.