The Financial Crimes Enforcement Network recently issued proposed rules that "would require banks and financial services companies to report and maintain records and verify the identity of customers" who do cryptographic transactions in unhosted portfolios.
The new rules, which were published for public comment until 4 January 2021, propose that any "virtual convertible currency" and "legal digital assets" be classified as "monetary instruments" and are therefore subject to the requirements of the Secrecy Act Banking.
According to these rules, any transaction totaling more than $ 10,000 in a 24-hour period must be reported to FinCEN, a US Treasury Department office, and the customer's identity must be verified; many transactions would require a lower limit of $ 3,000.
Therefore, the Know Your Customer rules apply even to private cryptographic wallets.
According to FinCEN, this "targeted expansion of BSA's reporting and record-keeping obligations" was designed to prevent illicit financing involving cryptocurrency.