FinCEN Drops $10,000 Crypto Wallet Reporting Rule and Mixer Proposal
The U.S. Treasury’s Financial Crimes Enforcement Network withdrew two crypto proposals on October 5. One would have required banks and crypto businesses to report transfers above $10,000 involving self-custody wallets. FinCEN also withdrew a separate proposal targeting crypto mixers.
The wallet proposal dates to December 2020. It would have required recordkeeping and customer verification for certain transactions above $3,000, with reporting for transfers exceeding $10,000. Neither proposal ever took effect. FinCEN said the withdrawals support the administration’s effort to create fit-for-purpose digital asset regulations.
Meanwhile, FinCEN said concerns about the mixer proposal included potential burdens on financial institutions and a chilling effect on legitimate privacy activity. The agency will continue monitoring mixers and retains authority to address illicit finance in the future. Existing anti-money-laundering obligations for financial institutions remain unchanged.
Why it matters
The withdrawals reduce regulatory uncertainty for self-custody users and crypto businesses. However, FinCEN can still pursue future measures targeting illicit crypto activity.
