Most People Are Unaware, But a Major Threat to Cryptocurrencies May Be Looming in the US

The US Treasury Department is preparing to impose a comprehensive ban on tools that provide privacy for cryptocurrency ￰0￱ Gacki, Director of the Financial Crimes Enforcement Network (FinCEN), announced this week in Congress that the “mixer rule” has reached its final ￰1￱ regulation, which uses PATRIOT Act powers to ban privacy-enhancing software and methods for cryptocurrency transactions, is now in its final ￰2￱ PATRIOT Act, enacted in 2001 after the September 11 attacks, gave the government broad oversight and investigative ￰3￱ the years, the law has tightened “know your customer” (KYC) and anti-money laundering (AML) frameworks in the financial system.

Now, these powers are being extended to digital ￰4￱ “mixer rule” the Treasury is working on classifies not just cryptocurrency mixers but also numerous on-chain transactions that can provide privacy as a “primary money laundering concern.” These include: Combine or split funds from multiple wallets or accounts Splitting transactions into parts and transferring them on the chain Creating disposable wallets or addresses Swapping between cryptocurrencies Applying user-induced delays to transactions Related News: Whales Are Hoarding Bitcoin, Small Investors Are Selling: What Does This Mean? Experts point out that these definitions are quite broad and could even lead to legitimate users being suspected of committing ￰5￱ the federal crime of breaking transactions into smaller pieces, known as “smurfing” in traditional finance, they suggest similar criminal liability could be extended to ￰6￱ with FinCEN's work, the Special Measures to Fight Modern Threats Act, previously considered dead in Congress, has been ￰7￱ Zach Nunn confirmed that the bill is still being ￰8￱ regulation could give the Treasury Department the authority to ban all crypto transactions verified through foreign countries, exchanges, or even miners abroad, without requiring any public due ￰9￱ argue that such authority could lead to a complete withdrawal of US banks and crypto exchanges from global transactions, which is an “authoritarian approach.” Cryptocurrency industry representatives believe that a complete ban on privacy software would disadvantage not only criminals but also individuals seeking protection from oppressive ￰10￱ direction the US will take on the final regulations will become clear in the coming weeks. *This is not investment ￰11￱ Reading: Most People Are Unaware, But a Major Threat to Cryptocurrencies May Be Looming in the US