FinCEN reopens comment period for proposed crypto wallet rule

The Financial Crimes Enforcement Network (FinCEN) has reopened the comment period for its proposed rule that would create new KYC requirements for crypto transactions in the U.S.

Commenters will have an additional 15 days to submit written comments on the reporting requirements related to a $10,000 transaction limit proposed in the rule. Another 45 days will be given to comment on the proposal that banks report counterparty information related to transactions with self-hosted wallets.

The proposed “Requirements for Certain Transactions Involving Convertible Virtual Currency of Digital Assets,” would subject all wallets to know-your-customer requirements and reporting requirements for transactions greater than $3,000.

FinCEN released the notice of proposed rulemaking in late December, leaving only 15 days over the course of a holiday period to submit comments. Industry stakeholders still managed to lodge 7,500 comments in that time, according to FinCEN. Many, including Coinbase and members of Congress, expressed their dissatisfaction with the shortened comment period, which was 45 days less than the standard 60 days. 

At that time, there was also confusion over when the initial deadline would take effect.

Many industry players believed the deadline to be Jan.4, or 15 days from the announcement of the proposed rule, as it stated in the text of the proposed rule. However, at some point during the comment period, the date was changed to Jan. 7 in the comment portal, though the text of the notice still stated a Jan. 4 deadline. Jan. 7 marked 15 days from the day the notice was published in the Federal Register.

FinCEN did not publicize the date change and did not respond to multiple requests for comment on why the date change occurred with no notice. It did not touch on the reason for the initial shortened comment period in its reopening notice, but did note that many of the comments received in the initial period cited the shortened length.

 

 

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