One of the largest cryptocurrency exchanges in the US, Coinbase, is advocating extension for the industry’s feedback deadline to newly proposed crypto rules by the Treasury’s Financial Crimes Enforcement Network, or FinCEN. Coinbase’s chief legal officer Paul Grewal addressed FinCEN’s newly released rulemaking regarding self-hosted crypto wallets. The blog post represents an open letter to Kenneth Blanco, the director of FinCEN. Grewal considered the new rules by the FinCEN as an “unfortunate and disappointing departure” from the company’s long-running relationship with the regulator.
The 15-day period granted by FinCEN is not enough.
Coinbase’s Chief Legal Officer elaborated that the 15-day period granted by FinCEN to the industry to respond to the new rules is not enough, especially given that it is spanning during the Christmas holidays and the COVID-19 pandemic. Grewal wrote, “FinCEN asked the public to provide comments in just 15 days, spanning Christmas Eve, Christmas Day, New Year’s Eve, and New Year’s Day, in the middle of a global pandemic — leaving just a handful of actual working days for comments.” Coinbase’s legal executive asked FinCEN to “reconsider its haste” and provide a typical 60-day period notice-and-comment for the proposed rulemaking.
FinCEN proposed new KYC regulations for crypto exchanges.
As reported earlier, the U.S. Financial Crimes Enforcement Network (FinCEN) presented new KYC requirements for cryptocurrency users in the country to combat the potential involvement of crypto in illegal activities. Crypto exchanges are required to verify the identity of the wallet owner if the transaction exceeds $3,000. It requires crypto exchanges to submit the information of transactions above $10,000 to the FinCEN. Steven Mnuchin, Secretary of the U.S. Treasury Department, said that this rule addresses substantial national security concerns in the convertible virtual currency (CVC) market and aims to close the gaps that malign actors seek to exploit in the recordkeeping and reporting regime.