The strict and controversial control of transactions with private crypto wallets is frozen by the Biden administration in the USA. A relief for the DeFi and cryptocurrency industry.
On the other hand, if the testimony of the prospective Treasury Secretary caused a cold in the United States, freezing FinCEN’s proposal is a relief. Indeed, the Financial Crimes Enforcement Network advocated applying new rules to crypto gamers.
In particular, the agency proposed a new rule that would apply to self-managed portfolios, or « self-hosted wallets ». For its use, companies would have had to verify the identity of a transaction to and from private crypto wallets.
KYC on private wallets after 60 days of shutdown
These regulations, put forward under the direction of former Treasury Secretary Steven Mnuchin, sparked an outcry. It is no longer relevant. At least temporarily.
On his first day at the White House, President Biden actually ordered all regulatory developments within federal agencies to be frozen. This President’s memorandum therefore does not specifically refer to crypto.
The suspension is for 60 days from the date the new White House chief’s memo is posted. While this is preliminary, that decision is already a source of relief.
“We fought hard and won the right to catch our breath and start over. Janet Yellen is not Steve Mnuchin. I’m optimistic, ”says Jake Chervinsky, Legal Director of Compound Finance.
Crypto adapted for illegal funding
The critics of the new FinCEN rules were unanimous in the crypto industry and especially among the exchanges. Jack Dorsey, head of Square and Twitter, believes that such identity control shouldn’t apply to cryptocurrency like cash.
Janet Yellen, the future Treasury Secretary, will she be more forgiving? This has yet to be demonstrated. His most recent statements are worrying. She believes that cryptocurrencies “mainly intervene for illegal funding. « »
However, Jake Chervinsky wants to be quiet. « First, anyone is better than Secretary Mnuchin, who decided a long time ago that he hates anything to do with crypto, » he responded.
Second, although Dr. Yellen is not a fan now, I hope she is open to learning, listening and following the normal process for deciding on new rules. That’s good, ”he continues.