The U.S. Treasury’s Financial Crimes Enforcement Network has withdrawn two proposals targeting private crypto wallets and mixing transactions. One would have required financial firms to report certain crypto transfers above USD 10,000 involving self-custody wallets.
The other sought extra reporting on international crypto mixing. FinCEN announced the withdrawals on October 5. Neither proposal had taken effect.
The wallet proposal dated to December 23, 2020, during the final weeks of President Donald Trump’s first administration. It covered certain transfers, deposits, withdrawals and exchanges involving banks or money services businesses, including crypto exchanges.
Under the plan, firms would have reported covered transactions exceeding USD 10,000 to FinCEN. They would also have reported multiple transfers that together exceeded USD 10,000 within 24 hours. Reports would have included information about the customer, the transaction and the other party.
A separate threshold applied to recordkeeping. For covered transactions above USD 3,000, banks and money services businesses would have kept customer and counterparty information. They would also have verified the identity of their customers. These requirements differed from the proposed reporting obligation.
Self-custody wallets allow users to control their private keys without relying on an exchange or bank. The proposal also covered certain wallets held at foreign financial institutions outside Bank Secrecy Act requirements. FinCEN would have identified the foreign jurisdictions subject to those provisions.
FinCEN’s second proposal dated to October 23, 2023. It sought additional records and reports when financial institutions knew or suspected that transactions involved international crypto mixing. Mixing combines or rearranges transfers, making their source, destination or amount harder to trace.
The proposal defined mixing broadly. Its examples included pooling funds, splitting transfers, using temporary wallet addresses and delaying transactions. It also covered exchanges between digital assets, extending its scope beyond services commonly described as mixers.
Financial institutions would have reported transaction amounts, asset types, wallet addresses and transaction identifiers. The proposed records also included customer identity details. FinCEN has now withdrawn both the proposal and its related finding that international mixing presented a primary money-laundering concern.
In its withdrawal notice, FinCEN cited concerns about the definition’s reach and firms’ reporting workload. Commenters warned that it could have 'a chilling effect on legitimate activity.' The agency also cited a July 2025 White House report recognizing lawful uses of mixers for financial privacy.
FinCEN said it reviewed public comments before withdrawing both measures. The agency linked its decision to the Trump administration’s 'deregulatory agenda' and efforts to make digital-asset regulations 'fit-for-purpose.' Its October 5 announcement addressed both pending proposals together.
Since neither proposal became a final rule, the withdrawals do not remove existing requirements for financial institutions. Instead, they end these efforts to introduce additional obligations for wallet transfers and mixing transactions. Banks and crypto businesses retain their existing compliance duties.
The wallet notice states that FinCEN will take no further action on that proposal. Meanwhile, the mixing withdrawal took effect on October 6, 2026. FinCEN said it will keep monitoring mixers for money laundering, terrorist financing and other illegal financial activity. It may take further steps to address such activity in the future, the agency said.
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