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.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.