FinCEN withdraws wallet and mixer surveillance rules

FinCEN, the U.S. Treasury's financial-crimes unit, has withdrawn two proposed crypto surveillance rules: a 2020 proposal that would have imposed identity checks on transactions involving self-custodied wallets and a 2023 proposal targeting crypto mixing services. The withdrawal, first reported by Coin Center, ends both pending rulemakings.

• The 2020 rule would have required banks and money-services businesses to collect and report counterparty information on unhosted-wallet transactions above a threshold.
• The 2023 rule targeted international convertible virtual currency mixing.

The moves reverse surveillance measures proposed under the prior administration that had hung over self-custody and privacy tooling for years without ever taking effect, easing compliance pressure on those activities.