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U.S. scraps proposed $10,000 reporting rule for for crypto sent to private wallets
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The U.S. Treasury Department's Financial Crimes Enforcement Network has scrapped a years-old proposal that would have forced banks and crypto businesses to report large transfers to wallets customers control themselves. FinCEN withdrew the rule on Sunday, along with a separate proposal targeting transactions involving crypto mixers. Neither measure had ever taken effect. The decision removes two long-standing regulatory overhangs for self-custody and privacy tools in the digital-asset sector.
The wallet proposal dated to December 2020, issued in the final weeks of the first Trump administration. It would have required banks and money-service businesses, including crypto exchanges, to file reports whenever customers sent more than $10,000 in crypto to or from unhosted wallets. Transactions crossing that threshold when added together over a 24-hour period would have triggered the requirement. Firms would also have had to collect information about the customer and the wallet on the other side of the transfer.
An unhosted wallet is one in which a person holds the private keys themselves, rather than leaving assets with an exchange or bank. The proposal drew thousands of public comments and remained unresolved for nearly six years.
The second withdrawn proposal, from 2023, would have classified crypto mixing transactions as a category of primary money-laundering concern. That designation would have allowed the government to impose additional reporting requirements on financial institutions handling such transactions.
FinCEN said both withdrawals advance the Trump administration's deregulatory agenda and its effort to create digital-asset rules that are "fit-for-purpose." The move signals a more permissive federal posture toward self-custody and privacy-preserving crypto activity.
Because neither rule ever took effect, no compliance obligations change immediately; rather, the withdrawals eliminate the prospect of future requirements built on them. Industry participants had for years planned around the possibility that the 2020 rule could be revived.
Looking ahead, the withdrawals leave crypto reporting policy to future rulemaking and legislative efforts. Observers will watch whether FinCEN issues replacement guidance on self-hosted wallets or mixer-related activity under the administration's stated digital-asset priorities.
