President Joe Biden has mandated all federal agencies in the United States to temporarily suspend all in-process regulations pending when they have been thoroughly reviewed by members of his cabinet. This also puts FinCEN’s proposed rule on non-custodial crypto wallets on hold.
Mnuchin’s Draconian Crypto Wallet Rule on Hold
It appears the crypto community is gradually winning the battle against Steven Mnuchin’s proposed non-custodial crypto wallet rule as the Biden administration has now frozen all in-process regulations.
As reported by last November, Coinbase’s Brian Armstrong took to Twitter to raise alarm concerning a proposed rule by Treasury Secretary Steve Mnuchin to make it mandatory for crypto exchanges to conduct fresh KYC procedures for customers looking to transfer their digital assets to non-custodial wallets.
The move received serious criticisms and backlashes from cryptocurrency industry leaders as well as some members of the Congress like Tom Emmer (R-Minn), Scott Perry, Warren Davidson and others, who sent a letter to the US Treasury Secretary, asking him to rethink his course of action, as it could have dire consequence for the US cryptospace.
“It would hinder American leadership and preclude meaningful participation in the technological innovation currently underway throughout the global financial system,” wrote the Congressmen.
Self-Hosted Wallet Rule Hit a Snag
Now, the game plan of critics of Mnuchin’s draconian crypto regulation is working out exactly as planned, as it will take at least 60 days for the current administration to revisit it and possibly throw it out of the window.
Neeraj Agrawal, Communications Director at Coin Center said:
“Thanks in part to the community’s response, the rulemaking was extended into the Biden administration. When a new government takes office it’s standard practice to freeze and evaluate ongoing rulemaking.”
In the same vein, Whitehouse Chief of Staff, Ronald Klain has ordered all government parastatals to postpone all rulemaking for 60 days, to enable the current administration to effectively “review any questions of fact, law, and policy the rules may raise.”
Agrawal has also hinted that the postponement will afford the crypto community more time to hold concrete talks with the current Biden administration concerning all crypto-related regulations.
In related news, the Dutch government has now made it mandatory for crypto exchanges to carry out KYC procedures for customers transferring funds to external wallets, in a bid to curb money laundering activities.