One of the biggest stories in crypto right is the news that the Financial Crimes Enforcement Network (FinCEN) branch of the U.S. Treasury is working on cracking down on self-hosted wallets in crypto.
A document that outlines the proposed rule suggests that exchanges and other virtual asset service providers will need to verify the name and address of those that attempt to make withdrawals of over $3,000.
Proposed Rule Makes No Sense
While this is being done to prevent crypto crime, some think that this doesn’t make any sense.
Kathryn Haun, a general partner at a16z focused on crypto assets, wrote on the matter:
“Late yesterday, instead of following that process, @stevenmnuchin1 slashed the ordinary comment period to just 15 days, on a Friday before the holidays no less, for crypto regulations that to us @a16z and others in the crypto space don’t make much sense.”
There are others that have highlighted that this is redundant and just a way to prevent users from controlling their own funds. As is, most regulated exchanges have to take the names, addresses, and other details of traders that use fiat. This new rule doesn’t change much and actually goes further than traditional financial institutions need to go for cash transactions.
This rule has created such a stir that U.S. Congress members are coming out against the Treasury in a written letter.
Proposed Crypto Ruling By U.S. Treasury Opposed by Congresspeople
In a letter sent to the Treasury on December 31st, 9 congresspeople wrote that they have concerns over the proposed crypto ruling by FinCEN:
“We write to express our concerns regarding the process to respond to the Financial Crimes Enforcement Network’s (FinCEN) Notice of Proposed Rulemaking (NPRM) related to “Requirements for Certain Transactions Involving Convertible Virtual Currency or Digital Assets.” We share your goals of protecting national security and supporting law enforcement in their efforts to combat criminals who seek to engage in money laundering, illicit financing, and other criminal activity. However, we are concerned that the Treasury Department’s approach to establishing complex new rules for the recordkeeping and reporting of convertible virtual currency and legal tender digital asset transactions do not afford the American public a reasonable opportunity to respond.”
The group seems to be most opposed to the lack of time given for the American people and for others to respond to the proposed ruling.
The group that sent this letter includes Tom Emmer, Tom Cotton, Warren Davidson, Tulsi Gabbard, and a number of other members of Congress.