The Financial Crimes Enforcement Network (FinCEN) on Monday, October 5, 2026, withdrew two proposed anti-money laundering rules for crypto transactions. The first, from December 2020, would have required banks and money services businesses (MSBs) to keep records, verify customers, and file reports on certain transactions with unhosted wallets. The second, from October 2023, would have imposed reporting requirements on international convertible virtual currency (CVC) mixing, which FinCEN had found to be a class of transactions of primary money laundering concern under section 311 of the USA PATRIOT Act. That finding is withdrawn as well. Both withdrawals were published in the Federal Register on October 6 and apply as of that date.
“FinCEN has considered the comments submitted in response to these proposals and is withdrawing them as part of the Trump Administration’s deregulatory agenda and ongoing efforts to ensure digital asset regulations are fit-for-purpose,” the agency said. Both notices, signed by Deputy Director Jimmy L. Kirby, cite the July 2025 report of the President’s Working Group on Digital Asset Markets.
The 2020 rule would have tracked counterparties above $3,000
Published on December 23, 2020, weeks before the first Trump administration left office, the first proposal covered transfers of CVC, or of digital assets with legal tender status, by, through, or to a bank or MSB when the counterparty used an unhosted wallet, described as “when a financial institution is not required to conduct transactions from the wallet.” It also reached wallets at foreign institutions outside the Bank Secrecy Act, in jurisdictions identified by FinCEN. Above $3,000, the bank or MSB would have verified its customer and kept records of the transaction and counterparty. Above $10,000, alone or aggregated over 24 hours, it would also have filed a report. FinCEN “will take no further action on this NPRM,” the withdrawal states.
FinCEN drops the mixing finding over its broad definition
The October 23, 2023 proposal would have imposed special measure one, one of the four section 311 measures that add recordkeeping and reporting duties. Covered institutions would have reported any CVC transaction they knew, suspected, or had reason to suspect involved mixing within or involving a jurisdiction outside the US, with details such as the mixer used, wallet addresses, transaction hashes, and IP addresses. Mixing meant facilitating CVC transactions in a way that obfuscates their source, destination, or amount, “regardless of the type of protocol or service used,” from pooling funds and splitting transfers to single-use wallets and user-initiated delays.
FinCEN said the withdrawal “is informed by the concerns from commentors that the expansive definition of CVC mixing in the proposed rule could have a chilling effect on legitimate activity and place a large reporting burden on covered financial institutions.” It maintains that illicit actors still use mixers and says it “will continue to monitor activity involving CVC mixers” and may act in the future.
Stablecoin transfers with self-hosted wallets escape a new report
The withdrawals leave intact the framework Treasury is writing for stablecoin issuers under the GENIUS Act. A joint proposal from FinCEN and the Office of Foreign Assets Control (OFAC), published April 10, 2026, places on the “secondary market” cases such as “an individual sending payment stablecoins from a self-hosted wallet to a vendor to purchase goods.” There, issuers would need the technical capabilities, policies, and procedures to block, freeze, and reject impermissible transactions. FinCEN did not propose requiring them to monitor that activity or file suspicious activity reports on it. The rule remains a proposal.
Coin Center, a crypto policy group that opposed both proposals, called the withdrawal “a significant victory for financial privacy and for the principle that Americans should be able to use cryptocurrency directly without inappropriate government surveillance.”