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In the United States, they proposed introducing mandatory verification of cryptocurrency wallets. According to the published According to the proposal of the FinCEN agency, controlled by the US Treasury, data on the owners of cryptocurrency wallets will be stored in databases and tracked in case of suspicious transactions.
If the proposal is approved, to offline wallets(hardware / cold storage of cryptocurrencies) tougher measures will be applied when interacting with centralized crypto exchanges. FinCEN proposes to classify standalone wallets as "wallets that are held by a financial institution that is not subject to the Bank Secrecy Act."
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In particular, it is proposed to apply extendedknow your customer (KYC) policy methods in case of withdrawal of funds over $ 3000. Transactions over $ 10,000 must be reported to FinCEN. FinCEN also plans to take a pencil breakdown of large transactions into small ones in order to avoid supervision.
Until January 4, 2021, the proposed innovations are undergoing public consultations.
The founder of the non-profit organization OpenPrivace Sarah Jamie Lewis has already called the proposals of the US Treasury Department "censorship of all human ties."
Recall that in some countries such measures are alreadyare actively functioning. For example, the Dutch cryptocurrency exchange Bitonic announced a tightening of the withdrawal of funds, including the identification of crypto wallets, due to the requirement of the country's central bank. Then the exchange called the new regulation measures "ineffective and disproportionate."
FinCEN's proposal is in line with the Financial Action Task Force (FATF) guidelines for identifying cryptocurrency users published last year.
“This way they can collect a huge database of wallet owners without relying on Chainalysis data, which is always probabilistic. - writes The Block analyst Larry Cermak.
The authorities will now have a confirmed listowners of wallets. I think users will withdraw cryptocurrency to an identified wallet, and then carry it through Tornado Cash or another mixer until it is also banned. "
Circle founder Jeremy Aller adds:
“FinCEN's new offering is disrupting Decentralized Finance (DeFi). How can a person provide the name and address of the counterparty if it is a DeFi protocol? This rule is untenable. "
Neeraj Agrawal of Coin Center, a cryptocurrency advocacy organization, says:
“Key takeaways: 1) Could be much worse; 2) This equates cryptocurrency with fiat currency; 3) The rushed night rule-making is undemocratic. "
Bitcoin activist Andreas Antonopoulos writes:
“If you try to send a payment fromregulated exchange, they will require additional verification and will pass information about your transaction to the authorities. If you use your own wallet, they cannot and will not monitor or report you. This will hit exchanges and custodial wallets because they have to do more work and force users to take more action. You will have to prove that the address belongs to you in order to display it. This year it will be $ 3,000. Next year they will lower the bar, even after adjusting for inflation. Over time, all transactions will be monitored. Not your keys - not your coins, additional barriers. Your keys are your coins, not your procrastination. "
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