Treasury Kills Crypto 'Unhosted Wallet' and Mixer Surveillance Rules — SkimNews
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- FinCEN withdrew its December 2020 "unhosted wallet" proposal, which would have required banks and money services businesses to keep records on self-custody wallet transactions above $3,000 and report those over $10,000, including counterparty information.
- FinCEN also scrapped a 2023 Biden-era proposal to designate international crypto mixing as a "primary money laundering concern" under the USA PATRIOT Act, which would have forced financial institutions to report wallet addresses, transaction hashes, and IP addresses tied to suspected mixing.
- Treasury cited the White House's July 2025 digital asset report in both withdrawals, quoting the administration's statement that it "supports the ability of lawful users of digital assets to privately transact on a public blockchain."
- Coin Center executive director Peter Van Valkenburgh called the move a "bright spot" on X but warned that "the underlying statutory authority to create new, similar bad rules remains."
- FinCEN said it will keep monitoring mixers for illicit finance and may take future steps, while the Consumer Financial Protection Bureau separately floated an interpretive rule last year to bring wallets like MetaMask under consumer payment law.
Why it matters: Self-custody crypto users and privacy advocates just won a major round, but the underlying Bank Secrecy Act and USA PATRIOT Act authority to craft similar rules is untouched—and FinCEN explicitly reserved the right to revisit mixers—so this is a reprieve, not a permanent wall against the same surveillance regime.
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