U.S. Drops Proposed $10,000 Crypto Reporting Rule for Private Wallet Transfers

The Financial Crimes Enforcement Network (FinCEN) has withdrawn two long-standing proposals that had raised concerns around self-custody and crypto mixing but were never implemented.

The U.S. Treasury Department abandoned a proposal that would have required banks and cryptocurrency businesses to gather and report additional information when customers transferred large amounts of digital assets to wallets they controlled themselves.

FinCEN formally withdrew the self-custody wallet proposal on Sunday, along with a separate measure focused on transactions involving cryptocurrency mixers. Neither proposal had taken effect.

The wallet rule was first introduced in December 2020, during the final weeks of Donald Trump’s first administration.

Under the proposal, banks and money-service businesses, including crypto exchanges, would have been required to submit reports for customer transfers exceeding $10,000 to or from so-called unhosted wallets. The threshold could also have been reached through multiple transactions combined over a 24-hour period.

Companies would additionally have been required to gather information about both the customer and the wallet involved on the other side of the transaction.

An unhosted, or self-custody, wallet is a crypto wallet in which the user maintains control of the private keys instead of holding the assets through an exchange, bank or other financial intermediary.

The proposal generated thousands of public comments and remained pending for almost six years without being finalized.

FinCEN also withdrew a separate proposal issued in 2023 that sought to designate cryptocurrency mixing transactions as a category of primary money-laundering concern. Such a classification could have enabled the government to impose additional reporting obligations on financial institutions involved in transactions connected to crypto mixers.

According to FinCEN, the withdrawal of both proposals aligns with the Trump administration’s broader deregulatory agenda and its effort to establish digital-asset regulations that are “fit-for-purpose.”