FinCEN withdraws proposed rules requiring bank reporting on self-custody wallets and crypto mixers under Trump administration deregulation push.
Regulation & Gov ·
The Financial Crimes Enforcement Network has rescinded two proposed rules that would have subjected cryptocurrency transactions to enhanced reporting requirements. The withdrawn rules targeted self-custody wallets and crypto mixing services, with the agency citing the Trump administration's deregulation priorities as rationale for the withdrawal.
Under the proposed framework, banks would have been required to report and verify customer identities for transactions exceeding $10,000 involving unhosted wallets. A separate provision would have mandated record-keeping and identity verification at financial institutions for transfers above $3,000 tied to self-hosted wallets. The rules also included strict reporting obligations on cryptocurrency mixing activities.
The Crypto Council for Innovation responded positively to the withdrawals, characterizing them as supportive of the digital asset ecosystem. However, enforcement pressure on privacy-focused services has continued through other channels—most notably the sentencing of Samourai Wallet co-founders on charges related to illegal transactions. The withdrawal represents a shift in regulatory posture but does not foreclose ongoing prosecution of specific service operators or eliminate broader anti-money-laundering obligations under existing law.