The Financial Crimes Enforcement Network (FinCEN) and the US Federal Reserve Board has invited comment on a proposed rule that would amend the recordkeeping and travel rule regulations under the Bank Secrecy Act.
The travel rule is affiliated with the Financial Action Task Force’s (FATF) attempt to reign in the digital asset sector of finance. The travel rule requires VASPs or virtual asset service providers, to maintain identity information for every sale/purchase/transfer of digital assets or cryptoassets. The expectation is that regulators around the world will adhere to the FATF request.
FinCEN, part of the US Department of Treasury, and the Fed Board are proposing amendments to the recordkeeping rule, while FinCEN, pursuant to its sole authority, is proposing amendments to the travel rule.
Under the current recordkeeping and travel rule regulations, financial institutions must collect, retain, and transmit certain information related to funds transfers and transmittals of funds over $3,000. The proposed rule lowers the applicable threshold from $3,000 to $250 for international transactions. The threshold for domestic transactions remains unchanged at $3,000.
The proposed rule also further clarifies that those regulations apply to transactions above the applicable threshold involving convertible virtual currencies, as well as transactions involving digital assets with legal tender status, by clarifying the meaning of “money” as used in certain defined terms.
Comments will be accepted for 30 days after publication in the Federal Register.