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FinCEN releases new guidance document for crypto-entities and activities




FinCEN releases new guidance document for crypto entities and activities
Source: Pixabay

In a recent development, the Financial Crimes Enforcement Network [FinCEN] published a thirty-page document guiding financial institutions to comply with current regulations while interacting with digital assets, and further analyzed activities and entities that come under their jurisdiction.

The latest “interpretive guidance” released by FinCEN noted that the guidance did not entail any new regulatory establishment. Instead, it “consolidates” existing FinCEN regulations and administrative rulings issued in 2011.

The guidance document stated that current and emerging business models, specifically involving money transmission in “convertible virtual currencies” or CVCs, would fall under the current obligations of the Bank Secrecy Act [BSA].

The overall guidance is structured in six sections. Section 1 to 5 entails key concepts, consolidation and summarizing the existing FinCEN regulations under BSA involving money transmission involving CVC activities, a summary of development and content of FinCEN’s 2013 guidance and regulatory approach. Section 6 lists all the resources for the purpose of further explanation covered in the guidance.

Software or non-custodial wallet providers and multi-sig providers without the ability to transact are not regulated as money transmitters.

The comprehensive document also highlighted decentralized applications or DApps in the same section, stating,

“The same regulatory interpretation that applies to mechanical agencies such as CVC kiosks applies to DApps that accept and transmit value, regardless of whether they operate for profit. Accordingly, when DApps perform money transmission, the definition of money transmitter will apply to the DApp, the owners/operators of the DApp, or both.”

Drawing a significant difference, FinCEN further noted that DApp developers did not qualify under the money transmitter definition only for creating the DApp. They will qualify as money transmitters under the BSA only when the DApp created is put to actual use for the purpose of money transmission.

The FinCEN document is similar to the recent framework published by the US Securities and Exchange Commission on the regulations applicable while engaging in the offer, sale, or distribution of digital assets.

The co-founder of @bloxrouteLabs, Emin Gun Sirer, tweeted,

“It is remarkable what the document does not do: it does not ban the tech. It does not ban any aspect of the technology that actually makes FINCEN’s job harder. It leaves anonymity providers exempt, for instance.”

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Bitcoin [BTC]: Binance’s CZ and Ryan Selkis try to predict BTC’s maximum value in the future

Akash Anand



Bitcoin [BTC]: Binance's CZ and Ryan Selkis tries to predict BTC's maximum value in the future
Source: Pixabay

Bitcoin [BTC], the world’s largest cryptocurrency has seen a surge in popularity again after the recent price increase. This movement was also helped by comments and suggestions from proponents and luminaries in the field of digital assets.

A recent tweet had asked Twitter users interested in cryptocurrencies about the “maximum reasonable price that Bitcoin can achieve in the reasonable future”, something which gained a lot of traction after the involvement of famous personalities like Changpeng Zhao and Ryan Selkis.

CZ, the Chief Executive Officer [CEO] of Binance, the world’s largest cryptocurrency exchange, answered the question by stating:

“There is no such a thing as Max price for $btc.”

He was also asked:

“Do you mean potentially infinitely high price of BTC or that in the near future goods and services will be priced in BTC and it won’t make sense to correlate it with USD?”

CZ’s reply was to the point when he claimed that there was no such thing as maximum inflation for fiat, a statement that a lot of people agreed with.

Ryan Selkis, the Founder of Messari had another opinion to the original question. He said,

“After $250k / BTC the dollar’s reserve status will be in jeopardy, so all bets are off.”

CZ and Selkis were not the first individuals to predict such positive movement as many in the past have predicted Bitcoin to reach heights of even $1 million per Bitcoin. At the time of writing, Bitcoin was trading at $7,967.54, with a total market cap of $14.21 billion. The 24-hour trading volume of the cryptocurrency was $21.04 billion, while the currency was holding a steady 0.45 percent increase in its value over the hour.

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