'There Is No Emergency Here': Coinbase Asks FinCEN to Extend Comment Period on Wallet Regs

Two weeks during the holiday season and a pandemic is not enough time, the exchange said, asking for the customary 60 days.

Dec 22, 2020 at 1:32 a.m. UTC
Updated Sep 14, 2021 at 10:46 a.m. UTC

Leading cryptocurrency exchange Coinbase asked the U.S. Treasury Department to extend the comment period on proposed know-your-customer (KYC) requirements from 15 days to the typical 60 days normally afforded such proposals.

  • Coinbase noted the Financial Crimes Enforcement Network (FinCEN), part of the U.S. Treasury, asked for comments on 24 questions, each requiring detailed analysis and extensive cost assessments.
  • "Addressing all of the questions FinCEN has posed and the additional issues FinCEN has not yet considered would take much longer than 15 days in the best of times," Coinbase said in its letter. "To do so in a handful of working days across the national holidays and during the latest surge in [COVID-19] is quite obviously impossible."
  • Under the advanced notice of proposed rulemaking announced last week, users who want to send cryptocurrencies from centralized exchanges to a private wallet would need to provide personal information about the owner of that wallet to the exchanges, if the amount sent is greater than $10,000 in one day. 
  • The exchanges would also need to submit and store records involving such transactions with a total value over $10,000 in a 24-hour period, and maintain records for transactions over $3,000.
  • The general public will have until Jan. 4, 2021, to provide comments or feedback (although another part of the document says feedback can be submitted within 15 days after the rule is published in the Federal Register, the national logbook, on Dec. 23).
  • While 60 days of comment is the norm for such proposals, the Treasury Dept. cited "significant national security imperatives" for the shortened period.
  • Coinbase attributed a more mundane reason for the shortened review period: "There is no emergency here; 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," the exchange said in its letter to the director of FinCEN.
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