On Friday, December 18, the U.S. Treasury’s bureau FinCEN proposed new crypto rules making it mandatory for virtual asset service providers (VASPs) to record and report transactions related to private cryptocurrency wallets. There’s been a significant disagreement expressed by the crypto community members and even some crypto-friendly U.S. lawmakers.
Diving deep into what these proposed rule changes mean for crypto users, lawyer Jake Chervinsky decodes how these rules fail to address the fundamental concerns of preventing illicit activities and money laundering. The lawyer adds that the FinCEN proposed rules only add new obligations on VASPs such as custodians and exchanges. Below are some of the few interesting pointers that Chervinsky notes:
In his complete thread, Chervinksy presents many such loopholes that the new crypto rules fail to address. However, looking at the positive side, Chervinsky notes that this could have been even worse. The only good thing he mentions is that the newly proposed crypto rules “doesn’t require KYC for every transaction with a non-custodial wallet. It isn’t an outright ban on self-custody. It doesn’t prohibit the act of using a permissionless network”.
Brian Armstrong, the CEO of Coinbase exchange has been vehemently opposing it, soon as the rumors broke out last month. Armstrong details all his views in this Twitter thread. He notes:
“Given these barriers, we’re likely to see fewer transactions from crypto financial institutions to self-hosted wallets. This would effectively create a walled garden for crypto financial services in the U.S., cutting us off from innovation happening in the rest of the world.”
Wyoming Senator-elect Cynthia Lummis, who also happens to Bitcoins, has expressed her dissent with the latest FinCEN action. She notes:
“Congress is best placed to weigh the competing policy issues at stake. A rule adopted now could also potentially extend the BSA to new types of transactions beyond Congress’ intent. Treasury’s rule would also likely be adopted without public comment under an often-abused portion of the Administrative Procedure Act. Transparency makes good policy. It’s really that simple. Let the sunshine in, Mr. Secretary.”
Crypto exchange Coinbase has applied for a national trust charter, joining the likes of Ripple,…
Tether Holdings, the company behind the world’s largest stablecoin USDT, is preparing to raise at…
REX Shares and Osprey Funds have filed for 21 single-asset crypto exchange-traded funds (ETFs) with…
When most people think of crypto platforms, their minds jump to consumer-facing exchanges with bold…
Standard Chartered believes Bitcoin (BTC) could reach a record high by the end of 2025.…
Walmart's OnePay App is the latest company to jump on the crypto wave, with plans…