Application of FinCEN’s Regulations to Persons Issuing Physical or Digital Negotiable Certificates of Ownership of Precious Metals Summary

Updated 12/27/2021

This tool summarizes FinCEN’s ruling regarding a company that provides internet-based brokerage services between buyers and sellers of precious metals. The following are the key takeaways of the ruling:

As part of the analysis of whether a person is a money services business, you must identify the role the person is playing: (1) exchanger, (2) administrator; or (3) user.

An exchanger is subject to FinCEN regulations regardless of whether the exchanger is acting as a broker (matching buyers and sellers) or as a dealer (transacting from its own reserve in either convertible virtual currency or real currency).

As the definition of “money transmitter” does not differentiate between fiat currencies and convertible virtual currency, the same rules apply to brokers and dealers of virtual currency.

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