Bitcoin under siege from Trump anti-money laundering push

Donald Trump

Revenge of the Don? There’s a storm coming. The Biden administration may soon have a fight on its hands. A fight involving the crypto industry and tighter anti-money laundering regulations.

Last-minute rules proposed by outgoing Trump administration concern the creation of new requirements for financial services firms to create new requirements for financial services firms to record identities of cryptocurrency holders.

The proposal threatens what many believe is the best feature of Bitcoin — the ability to send money without the government watching.

As reported, the Treasury Department raced to issue the rules under FinCEN, the Financial Crimes Enforcement Network, after President Donald Trump lost the election. The move swiftly generated a negative reaction, with a crypto trading group even threatening a lawsuit.

This prompted an eleventh-hour reprieve that pushed the final decision to the Biden administration and Treasury Secretary Janet Yellen.

And while there is no timetable for when a decision will be made, the sword continues to hang.

The FinCEN proposal is meant to make it harder for Bitcoin users to hide their identities. Banks and money services businesses like crypto exchanges would be required to file a report to the Treasury when a customer moves at least $10,000 worth of virtual currency into a wallet not hosted on an exchange.

Yeah, it’s that bad.

And wait, it gets worse!

That was just the first part. The second part of the regulation would mandate banks and exchanges to keep a record whenever their customers send $3,000 worth of virtual currencies to someone else’s hosted wallet.

Expectedly, crypto advocates flooded FinCEN with comments, arguing that not only was the process rushed, the rules were unworkable.

If Yellen moves forward with the rules, crypto proponents say some virtual currency services will become costly and some currencies could disappear completely. The regulations could also cause a sharp fall in the prices of virtual currencies like Bitcoin.

The market, obviously, reacted negatively to this development, with the price of Bitcoin and other major currencies nose diving from the $50,000 mark it achieved after a slow and steady rise.

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