The Financial Crime Enforcement Network (FinCEN) announced that it will soon raise the impact The proposal for cryptocurrency held by foreign exchange is separated from the FinCEN recently proposed on the cryptocurrency wallet.
FinCEN’s new encryption rules
FinCEN, a subsidiary of the US Department of the Treasury, issued a notice on the new application requirements for cryptocurrencies on Thursday. FinCEN details:
Currently, the “Foreign Banking and Financial Account Report” (FBAR) regulations do not define a foreign account holding virtual currency as a reportable account.
The notice also added that the bureaus “plan to propose to amend the Bank Secrecy Act (BSA) regulations on foreign financial account (FBAR) reporting to include virtual currency as a form of reportable account.”
Shehan Chandrasekera, Head of Tax Strategy at Cointracker, explained: “FBAR is a form. If you have more than 10,000 foreign financial assets at any time of the year, you need to submit it to the tax return.” He clarified: “This form is not required. To pay taxes, only additional disclosure is required.”
Manatt’s lawyer Marc Boiron said: “Goodbye non-US exchanges… FBAR must archive non-US virtual currency accounts.” He emphasized:
Accidental failure to submit FBAR may result in a civil penalty of $10,000 per violation.
Adam Cochran, a strategist at Duckduckgo, said: “Another example of overregulation in the United States.” “It’s crazy, but this rule will become FinCEN’s rules for wider international exchanges.”
Attorney Jake Chervinsky said that the proposal “seems to be aimed at non-US exchange users,” and he believes that the proposal “does not apply to self-custodial assets.” He suggested that the reason for the proposal may be tax evasion or “encourage non-US crypto companies to comply with the Bank Secrecy Act.” FinCEN is currently also trying to implement rules on cryptocurrency wallets before Trump’s term ends.
What do you think of this new rule proposed by FinCEN? Let us know in the comments section below.
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