Key Insights U.S. Treasury news confirmed withdrawals of two pending crypto proposals. FinCEN dropped reporting requirements targeting certain self-custody wallet transactions. FinCEN also wi
The U.S. Treasury’s Financial Crimes Enforcement Network withdrew two long-pending crypto proposals on Oct. 5. The move ended proposed reporting rules for unhosted wallets and a separate surveillance framework for cryptocurrency mixing. The latest U.S. Treasury news removed two compliance proposals that had remained unresolved for years.
FinCEN said it considered public comments before withdrawing both proposals. The agency tied the decision to efforts to make digital-asset regulation fit for purpose. The withdrawals reduced prospective compliance duties for banks and money services businesses handling certain crypto transactions.
They did not remove existing Bank Secrecy Act obligations or FinCEN’s enforcement authority. FinCEN retained authority to monitor and act against illicit financial activity involving digital assets.
The first withdrawal concerned a proposal first published on Dec. 23, 2020. FinCEN had proposed recordkeeping, verification and reporting requirements for transactions involving convertible virtual currency and certain digital assets.
The proposal covered transactions involving unhosted wallets or wallets hosted in jurisdictions identified by FinCEN. It would have required banks and money services businesses to report qualifying transactions above $10,000. Multiple transactions exceeding $10,000 within 24 hours would also have triggered reporting.
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The proposed crypto rules also required recordkeeping for covered transactions above $3,000. Banks and money services businesses would have verified customer identities when counterparties used covered wallets. FinCEN’s withdrawal notice said the agency would take no further action on that proposal.
The U.S. Treasury news therefore closed a rulemaking process that had remained pending since 2020. FinCEN reopened and extended the proposal’s comment period in January 2021. The agency said then that it had reviewed more than 7,500 public comments.
The second withdrawal covered FinCEN’s October 2023 proposal on convertible virtual currency mixing. FinCEN had classified international mixing as a class of transactions of primary money laundering concern.
The U.S. Treasury news also narrowed a policy debate that began under the previous administration. The mixer proposal had remained pending for nearly three years without becoming a final rule.
That proposal relied on Section 311 of the USA PATRIOT Act. It would have required covered financial institutions to report transactions they knew or suspected involved international crypto mixing.
Required information could have covered transaction amounts, wallet addresses, transaction hashes and dates. The proposal also covered related internet protocol addresses and customer identification data.
FinCEN said commenters raised concerns about the proposal’s broad definition of mixing. The agency acknowledged that the definition could affect legitimate activity and impose large reporting burdens. That reasoning added regulatory context to the latest U.S. Treasury news.
The withdrawal did not mean FinCEN abandoned oversight of mixers. The agency said illicit actors still used mixers and related tools to obstruct investigations. FinCEN said it would continue monitoring mixer activity for money laundering and terrorist-financing risks.
The withdrawals also aligned with recommendations from the President’s Working Group on Digital Asset Markets. Its July 2025 report supported lawful private transactions on public blockchains. The report also asked Treasury to reconsider the pending mixer proposal.
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The White House report urged Treasury and regulators to clarify Bank Secrecy Act obligations for digital assets. It also recommended that Congress reinforce self-custody protections. Those recommendations provided the policy backdrop for the latest U.S. Treasury news.
However, the administration did not eliminate digital-asset anti-money-laundering controls. FinCEN proposed customer identification requirements for permitted payment stablecoin issuers in June 2026. The agency also continued rulemaking against sanctions-evasion networks.
That distinction matters for crypto firms assessing the withdrawals. The abandoned crypto rules reduced potential reporting obligations tied specifically to self-custody and mixing. Existing Bank Secrecy Act requirements still apply where relevant.
The Federal Register scheduled both withdrawal notices for publication on Oct. 6. Publication will formally record the end of the two proposed rulemakings. FinCEN stated that it would take no further action on the unhosted-wallet proposal.
For mixers, the agency left future action open. FinCEN said it may respond if monitoring identifies money laundering or other illicit finance risks. That makes future enforcement guidance and targeted proposals the next regulatory markers for U.S. Treasury news.
This article is for informational purposes only and does not constitute financial, investment or legal advice. Digital-asset compliance requirements remain subject to existing laws and future regulatory action.
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