Dec 22, 2020 11:07 GMTCrypto News
Coinbase askes FinCEN to extend the consultation period.
The rushed ruling may be harmful to the cryptocurrency industry.
The largest US-based cryptocurrency exchange Coinbase filed an application with the Financial Crimes Enforcement Network (FinCEN) with the request to extend the period of public consultations regarding the potential requirement to introduce KYC for self-custody cryptocurrency wallets.
FXStreet previously reported that Coinbase CEO Brian Armstrong called the proposed measure counter-productive. He explained that the tight regulation would infringe on people’s identity and derail innovation, expansion, and its utility on a global scale.
Regulators want to take the industry under control
Bitcoin Price Suffers Biggest Plunge In December: What Happened?
KEY POINTS
The Treasury Department proposed new regulations concerning unhosted wallets
The new regulatory proposal was first hinted at by Coinbase CEO Brian Armstrong last month
Bitcoin suffered its worst drop in nearly a month amid reports of a database breach to hardware wallet company Ledger and upcoming rules from the Treasury Department and the Financial Crimes Enforcement Network (FinCEN).
Bitcoin experienced its second red candle in the last 10 days, dropping to as low as $21,922 before closing at 22,729 on Coinbase Monday. Bitcoin is still up 21% versus the previous month and 217% since the year began.
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Recently, the House and Senate passed the Corporate Transparency Act as part of the larger National Defense Authorization Act, sending it to the President’s desk by a veto-proof majority. They did so, appropriately, the same week as International Anti-Corruption Day. The Corporate Transparency Act is the culmination of a years-long effort – indeed, it and similar bills have been introduced in several past Congresses – to address a major roadblock to effective anti-corruption efforts in the United States: anonymous shell companies.
The formation of corporations and other legal entities in the United States is governed on a state-by-state basis. Many states collect less information in this process than they do in applying for a driver’s license. The critical area where information collection is lacking is the true, beneficial owners, who exercise significant control or derive a significant benefit from the legal entity. The Corporate Transparency Act closes this
Advertisement FinCEN Announces Proposed Rule Aimed at Closing Anti-Money Laundering Regulatory Gaps for Certain Convertible Virtual Currency and Digital Asset Transaction Monday, December 21, 2020
On December 18, 2020, the Financial Crimes Enforcement Network (FinCEN) issued a notice of proposed rulemaking that would require banks and money service businesses (MSBs) “to submit reports, keep records, and verify the identity of customers in relation to transactions involving convertible virtual currency (CVC) or digital assets with legal tender status (“legal tender digital assets,” or “LTDA”)”
1 held in wallets not hosted by a financial institution (“unhosted wallets”)
2 or wallets hosted by a financial institution in FinCEN identified jurisdictions.
Monday, December 21, 2020
Virtual Currencies as Commodities
In recent years, the U.S. Commodity Futures Trading Commission (CFTC or the Commission) has taken a role as one of the regulators of cryptocurrency in the United States. In this article, we review the CFTC’s regulatory and enforcement approach in this space.
In December 2014, the CFTC stated that virtual currencies are encompassed under the definition of a “commodity” in the Commodity Exchange Act (CEA), and thus subject to its jurisdiction.
[1] Nine months later, in September 2015, the CFTC brought its first enforcement action against an unregistered Bitcoin option trading platform.
[2] With its first action, the CFTC declared that “Bitcoin and other virtual currencies are encompassed in the definition and properly defined as commodities.”