US Crypto Firms Reluctant Towards New KYC/AML Proposal by FinCEN
The US crypto firm, Coinbase, sent a letter to FinCEN with a clear message, “There is no emergency here.” This message was sent regarding the proposal of the new financial regulation laid out by FinCEN.
Several crypto firms are reluctant about the new regulations that will obligate them to record personally identifiable information of their clients.
The US Treasury officially published a draft of these new regulations recently. According to FinCEN, the new regulations will assist in fighting money laundering. They have placed a 15-day period for public commenting on the new rules.
However, crypto firms disagree on the comment period duration. They say rushing the new rules’ implementation is not required. Paul Grewal, Chief Legal Counsel of Coinbase wrote a letter to FinCEN stating that there is no emergency. “There is only an outgoing administration attempting to bypass the required consultation with the public to finalize a rushed rule before their time in office is done. There is also no justification for treating the cryptocurrency industry so differently from our counterparts in traditional finance.”
After the implementation of the new regulations, crypto firms will have to record details on transactions over $10,000. FinCEN requires the firms to record personal data of crypto users who transfer more than $3,000 each day.
The Secretary of the Treasury, Steven Mnuchin says, “The rule, which applies to financial institutions and is consistent with existing requirements, is intended to protect national security, assist law enforcement, and increase transparency while minimizing the impact on responsible innovation”
These new regulations are laid out to fill the gaps that criminals may be able to exploit. New regulations are made stringent in hopes to eliminate money laundering through digital currency.