Crypto Mixing Rule Dropped Amid Concerns
Key Summary
The US Treasury Department's Financial Crimes Enforcement Network (FinCEN) has withdrawn its 2023 proposal to designate international crypto mixing as a "primary money laundering concern" under the USA PATRIOT Act, citing concerns that the rule could have a "chilling effect on legitimate activity." The proposal, which would have required banks to file reports on mixing transactions, was met with comments expressing concerns that it would stifle legitimate use of mixers for privacy reasons. FinCEN also withdrew a 2020 proposal requiring banks to verify customer identities and keep records on self-hosted wallet transactions.
Withdrawal of Crypto Mixing Rule
The US Treasury's Financial Crimes Enforcement Network (FinCEN) has withdrawn a proposal to designate crypto mixing as a primary money laundering concern under the PATRIOT Act.
The decision comes after concerns were raised that the proposed rule may have a 'chilling effect' on legitimate activities in the cryptocurrency space.
FinCEN cited the need to balance regulatory efforts with the need to promote innovation and growth in the crypto industry.