One of the first actions US President Joe Biden has taken on his first day in the office is to freeze the Federal regulatory process, including the controversial self-hosted crypto wallet regulations proposed by former Treasury Secretary Steven Mnuchin. The announcement came in a White House memorandum for the heads of various federal agencies, the Financial Crimes Enforcement Network (FinCEN) included. The edict doesn’t specify the crypto wallet proposal but places a general freeze on all agency rulemaking pending review, effective for 60 days from the date of the memorandum.
The crypto community supports the decision to freeze regulations.
The crypto industry insiders have lauded the move with Compound Finance General Council Jake Chervinsky stating, “We fought hard & earned the right to take a breath & reset. Janet Yellen isn’t Steve Mnuchin. I’m optimistic.” FinCEN made the self-hosted wallet proposal on December 18 under former US Treasury Secretary Mnuchin. If passed, it would require that banks and money service businesses submit reports, keep records, and verify customers’ identities who make transactions to and from private cryptocurrency wallets.
The proposed crypto wallet regulations receive negative feedback.
The proposed crypto regulations have been widely criticized by industry leaders, including CEO of financial services firm Square, Jack Dorsey, who said that counterparty name and address collection should not be required for cryptocurrency, just as it’s not required for cash today. Critics also stated that it would be technically impossible for many projects to comply because smart contracts do not contain name or address information. The new administration has appointed Janet Yellen to take over as Treasury Secretary, but she has already put a dampener on the crypto scene with critical comments this week that cryptocurrencies are used “mainly for illicit financing.”
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