Proposed Crypto Wallet Rule Not Among Those Frozen by Biden Pending Review
Crypto advocates mistakenly hailed the new administration for putting the controversial proposed rule on ice.
Correction (Jan. 26, 2021, 20:20 UTC): While this article originally said the rulemaking freeze would impact the proposed FinCEN wallet rule, that proposal was not covered. FinCEN did extend the comment period on Jan. 26.
President Joe Biden has frozen all agency rulemaking, including former Treasury Secretary Steven Mnuchin's controversial proposal on "unhosted wallets," according to a prominent cryptocurrency lawyer. However, the freeze does not impact the Financial Crimes Enforcement Network (FinCEN) rule proposal.
- The freeze, effective until the proposed rules undergo further review, is already mistakenly being hailed by cryptocurrency advocates, who fiercely opposed both the proposed rule and the initial attempt by the previous administration to rush it through.
- "We fought hard & earned the right to take a breath & reset," tweeted Jake Chervinsky, general counsel of Compound Finance and the DeFi Group co-chair at the Blockchain Association. "[Treasury Secretary nominee] Janet Yellen isn't Steve Mnuchin. I'm optimistic."
- First submitted on Dec. 18, 2020, the proposals would require exchanges to store name and address information for customers transferring over $3,000 in crypto per day to private crypto wallets, and file currency transaction reports (CTRs) for customers transacting in over $10,000 per day.
- Critics of the rule said it would be technically impossible for some projects to comply because smart contracts do not have name or address information to provide.
- Initially, the administration proposed a 15-day comment period on the rule, far short of the usual 60 days. After protests by a wide range of crypto groups and companies, the comment period was extended earlier this month.
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