The U.S. Anti-Money Laundering enforcement, during the Donald Trump era, could heavily impact Bitcoin in the current financial year. The proposal got extended till the end of March, leaving the matter to the Biden administration which could make a decision later this year, that could greatly affect the price of the cryptocurrency, if it implements.
During the Trump era, the U.S. Financial Enforcement Crimes Network (FinCEN) released a new proposal that placed identification requirements and mounted restrictions on transactions involving self-hosted crypto wallets.
Usually, such a kind of proposed regulation involves months of feedback and revisions. However, FinCEN’s published the rule on Dec. 18 and only allowed for a 15 day comment period that too during Christmas and New Year’s Eve.
The proposed regulation on self-hosted crypto wallets drew thousands of negative comments arguing that the process was rushed and that the feedback period should be extended.
The move pushed the final decision to the Biden administration and Treasury Secretary Janet Yellen. Even though there is no timetable for the final decision, the decision could be made by the end of the year.
FinCEN’s proposed crypto wallet regulation requires that banks and money services businesses, like cryptocurrency exchanges, report to the Treasury when a customer moves over $10,000 worth of virtual currency into a wallet not hosted at an exchange.
The proposal even requires banks and exchanges to keep a record of their customers who sent over $3,000 worth of virtual currencies to someone else’s unhosted wallet.
The Biden administration plans to keep a close eye on Bitcoin’s rise in the market. In his confirmation hearing, Biden’s pick and SEC chair nominee Gary Gensler said that the SEC would ensure cryptocurrency markets are free of fraud and manipulation under his regime.
Even if the Biden administration implements the proposed regulation, cryptocurrency services could become more costly or the use of such crypto-assets could disappear completely. In fact, the price of Bitcoin could fall in the long run as people will be hesitant towards crypto assets.