January 27, 2021

Cryptheory

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FinCEN Extends Comment Period for Proposed Crypto Rules

2 min read

The Financial Crimes Enforcement Network (FinCEN) has extended the comment period for its controversial rule that would force crypto exchanges to record and report certain transactions.

Submitted last month, the proposals would require exchanges to store name and address information for customers transferring over $3,000 per day to private crypto wallets. Additionally it would force them to file reports for customers transacting in over $10,000 per day.

Originally, the deadline for public comments was January 4, well short of the normal 60-day period.

As of January 8, more than 65,000 comments were submitted with the vast majority of them opposing the proposed regulation.

Commenting on today’s news, crypto lawyer and General Counsel at Compound Finance Jake Chervinsky suggested that “this doesn’t guarantee the rule won’t go through, but takes us well past January 20 & into the Biden administration.”

Jeremy Allaire, the CEO of Circle, has hailed today’s decision, calling it a “big win for the industry.”

“This topic will now get the appropriate time that it deserves. Look forward to working with FinCEN to address these issues,” he added.

The proposed rule was rumored as early as November 2020, when Coinbase CEO Brian Armstrong first revealed the FinCEN plans labeling them “a farewell gift” to the crypto industry from the Trump administration.

Numerous critics have repeatedly maintained that it would be technically impossible for some projects to comply with the proposed rule. This is specifically relevant for smart contracts and decentralized protocols as they do not have name or address information to provide.

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