The <a href="https://home.treasury.gov/" target="_blank" rel="nofollow noopener">US Treasury Department</a> is reconsidering a disputed proposal to identify who controls unhosted bitcoin wallets. Still, attendees at Consensus 2022 were assured that the policy would make room for innovations that would aid in the combat against financial crime.
According to Wally Adeyemo, deputy secretary of the Treasury, people could avoid sanctions and anti-money laundering (AML) checks by keeping crypto anonymously outside of approved venues.
<blockquote><em>"We're working to address the unique risks associated with unhosted wallets," </em>Adeyemo said during an onstage interview Friday, warning that current arrangements allow inadvertent transactions with criminals or sanctioned individuals.<em> "Unhosted wallets are effectively just addressing on a blockchain," </em>he added.<em> "It can be difficult to determine who really owns and controls them, creating opportunities to abuse this heightened anonymity."</em></blockquote>
<h2>Know Your Customer</h2>
Enforcing "know-your-customer" (KYC) identity checks on owners of private wallets was first proposed by then-Treasury Secretary, Steven Mnuchin, in 2020. Still, the proposal has been repeatedly postponed under the Biden administration – while parallel moves in the <a href="https://www.cryptoknowmics.com/news/european-union-considering-digital-euro-legislation/" target="_blank" rel="noopener">European Union</a> have raised industry concerns about stifling innovation and privacy.

The possibility that crypto payments could help Russia avoid sanctions imposed in response to its invasion of Ukraine has raised the stakes even higher. However, officials have pledged to work with the industry rather than against it.
<blockquote><em>"I'm not going to get ahead of our rule-making process,"</em> he said, but he guaranteed it would be flexible enough to cope with an industry that changes yearly.</blockquote>

US Treasury Official: Unhosted Crypto Wallet Rules Will Allow Innovation

The US Treasury Department is reconsidering a disputed proposal to identify who controls unhosted bitcoin wallets.

Usha is a diehard crypto enthusiast and has been actively writing on different facets of the blockchain and crypto world. She has authored many research articles on cryptocurrency and aims to provide informational and quality content to readers. She firmly believes that crypto has a great potential to redefine the world of finance and blockchain.

US Treasury Official: Unhosted Crypto Wallet Rules Will Allow Innovation

Top Picks