US Congress Warns Treasury on Unusually Short Timeframe Provided for Submitting Feedback on Proposed Cryptocurrency Rulemaking

Robin Mahler Weisman, Senior Policy Counsel at Coin Center, a leading non-profit entity focused on the latest policy issues facing digital currencies, notes that the US Congress had warned the Treasury regarding its “unusually short” timeline for feedback regarding its new cryptocurrency rulemaking proposal.

Weisman confirmed that a bipartisan group of 9 members had sent a letter to Secretary Mnuchin expressing concerns about the “poorly considered” rule.

Weisman wrote in a blog post published by Coin Center on December 31, 2020:

“Closing 2020 out with a bang, a bipartisan group of members of Congress joined in the chorus of protests to the process by which the Department of Treasury is seeking to rush through its proposed regulatory and reporting requirement for cryptocurrency.”

Weisman further noted that nine members sent a letter to Secretary Mnuchin in which they’ve asked for an extension of the truncated 15-day comment period. She pointed out that the letter cites concerns regarding the “unusually” short time period allowed for comments and doesn’t afford the American public “a reasonable opportunity to respond.”

She continued:

“Highlighting that the detailed and complex rulemaking was made public just before Christmas, with only eight work days to respond, the members request that the review period be extended to 60 days. We (Coin Center) could not agree more. Regardless of what you believe about the substance of the rule, an abbreviated rulemaking will serve little purpose to inform the final policy decision.”

She added that Coin Center also has “serious issues with the substance of the proposed rule.”

Peter Van Valkenburgh, the Director of Research at Coin Center had noted in December 2020 that during the past few years they’ve seen countries like Switzerland, Singapore, and the Netherlands adopt a technology-focused approach to regulating transactions involving “unhosted” cryptocurrency wallets.

Valkenburgh confirmed that the Financial Action Task Force (FATF) identified (potential) future measures in order to address peer to peer (P2P) transactions, which includes the possibility of banning or restricting access to certain wallets.

Valkenburgh pointed out these proposals have been “in the air” throughout 2020. As US lawmakers keep reviewing various options with respect to cryptocurrencies and anti-money laundering (AML) regulations, these types of proposals are on the table.

According to the Coin Center Research Director:

“Those options are bad. They are drags on innovation, they unnecessarily limit the rights of citizens, and they are not technology neutral. Fortunately, these are not the policies proposed by the Treasury today. However, there are issues with this proposal, it’s rushed and has complicated new counterparty identification requirements that may be infeasible and innovation-killing in the context of cryptocurrency networks.”

Weisman recently added:

“[Coin Center had] asked you to join in this opposition by sending a message to Secretary Mnuchin. Since we first asked you to join us in responding, thousands have made their voices heard. If you have not already done so, perhaps this action from Congress can motivate you as a final act of 2020, or a way to kick off 2021.”

She also mentioned that if you’re able to do so, then you should consider filing a comment with FinCEN in the proceeding “before the end of the day on January 4, 2020.” She further noted that “ideally you should write a unique and substantive comment letter and submit it at Regulations.gov.”

She added that if you’re unable to prepare “a unique and substantive letter, then you can still help by submitting a comment using the form our friends at Fight for the Future have put up—you can modify the template comment with your own views.”

She also mentioned that you may submit “a respectful message directly to Secretary Mnuchin by following this link that we have established: https://coincenter.good.do/fincen/fincen-email/.”

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