FinCEN Extends Comment Period for Rule Aimed at Closing Anti-Money Laundering Regulatory Gaps for Certain Convertible Virtual Currency and Digital Asset Transactions

January 14, 2021 / Source: FinCEN

Immediate Release

WASHINGTON—The Financial Crimes Enforcement Network (FinCEN) announced today it is reopening the comment period for its recent proposed rulemaking regarding certain transactions involving convertible virtual currency (CVC) or digital assets with legal tender status (LTDA). 

Under the Notice of Proposed Rulemaking (NPRM), banks and money services businesses (MSBs) would be required to submit reports, keep records, and verify the identity of customers in relation to transactions above certain thresholds involving CVC/LTDA wallets not hosted by a financial institution (also known as “unhosted wallets”) or CVC/LTDA wallets hosted by a financial institution in certain jurisdictions identified by FinCEN. 

Today’s Notice identifies additional statutory authority for the proposed rule under the Anti-Money Laundering Act of 2020, provides additional information regarding the reporting form, and reopens the comment period for the proposal.  Specifically, FinCEN is providing an additional 15 days for comments on the proposed reporting requirements regarding information on CVC or LTDA transactions greater than $10,000, or aggregating to greater than $10,000, that involve unhosted wallets or wallets hosted in jurisdictions identified by FinCEN.  FinCEN is providing an additional 45 days for comments on the proposed requirements that banks and MSBs report certain information regarding counterparties to transactions by their hosted wallet customers, and on the proposed recordkeeping requirements. 

FinCEN appreciates the robust responses already provided by commenters and has reviewed more than 7,500 comments submitted during the NPRM’s original comment period.  FinCEN looks forward to reviewing any additional information submitted during the extended comment period, and to continuing its active engagement with the cryptocurrency industry to ensure innovation with integrity that appropriately addresses anti-money laundering and national security risks.

The mission of the Financial Crimes Enforcement Network is to safeguard the financial system from illicit use, combat money laundering and its related crimes including terrorism, and promote national security through the strategic use of financial authorities and the collection, analysis, and dissemination of financial intelligence.

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