CoinDesk
FinCEN withdrew two proposed rules covering crypto transfers to self-controlled wallets and transactions involving mixers. One proposal would have required banks and crypto businesses to report transfers over $10,000 to or from unhosted wallets, including amounts aggregated over 24 hours. Neither rule ever took effect.
Why it matters
The 2020 wallet proposal would also have required firms to collect information about customers and the wallets on the other side of transfers. An unhosted wallet is controlled by its owner through private keys, rather than held by an exchange or bank. The proposal drew thousands of public comments and remained unresolved for nearly six years.
FinCEN also withdrew a 2023 proposal that would have treated crypto mixing transactions as a category of primary money-laundering concern, potentially leading to additional reporting requirements for financial institutions handling them. The agency said both withdrawals advance the Trump administration’s deregulatory agenda and its effort to create “fit-for-purpose” digital-asset rules.
Market impact
The decision removes proposed reporting obligations for financial firms handling transfers to or from self-custody wallets and transactions involving mixers. It does not change rules that were already in force, since neither proposal had taken effect. The withdrawals mark a shift in the federal approach to these two areas, while leaving future digital-asset rulemaking to determine what requirements replace them.
Frequently asked questions
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What would the withdrawn $10,000 wallet proposal have required?
Banks and crypto businesses would have had to report transfers over $10,000 to or from unhosted wallets. Transfers crossing the threshold in aggregate over 24 hours would also have counted.
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What information would firms have collected under the wallet proposal?
Firms would have collected information about the customer and the wallet on the other side of the transfer.
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What does an unhosted wallet mean in this rulemaking?
It is a wallet whose private keys are controlled by the individual, rather than an exchange or bank holding the assets.
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What did FinCEN’s 2023 mixer proposal seek to do?
It would have treated crypto mixing transactions as a category of primary money-laundering concern, potentially allowing additional reporting requirements for financial institutions handling them.
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Do the withdrawals change reporting rules that were already in force?
No. Neither proposal had taken effect, so withdrawing them removes proposed obligations rather than rules already in force.
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