On September 1, 2023, the Financial Conduct Authority (“FCA”) set out its expectations for cryptoasset businesses in the UK’s compliance with the “Travel Rule”, introduced by The Money Laundering and Terrorist Financing (Amendment) (No. 2) Regulations 2022 (the “Amended MLRs”).
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Critical Tornado Cash Developments Have Significant Implications for DeFi AML and Sanctions Compliance
After months of anticipation, a federal judge has finally ruled in the closely watched case of Joseph Van Loon, et al. v. Department of Treasury, et al. This important case addressed challenges to the US Department of the Treasury’s Office…
IRS Takes a Stand on Rewards From Staking Activities
By John Cobb & Shree Sharma
Cash method taxpayers that stake cryptocurrency native to a proof-of-stake blockchain and receive additional units of cryptocurrency as rewards when validation occurs must include the fair market value of the rewards in income in the year in which the taxpayer…
What Can UK Crypto Regulators Learn from the Passing of the EU’s MiCA Bill?
Earlier this year, the European Union (EU) voted in favour of the Markets in Crypto-Assets (“MiCA”) bill, which aims to regulate the crypto industry within the EU. The bill is seen as a major step towards establishing a comprehensive…
Risk Assessment Offers Treasury’s Most Extensive Comments to Date on DeFi Regulation
The Department of the Treasury’s recently issued Illicit Finance Risk Assessment of Decentralized Finance is principally intended to provide insight on how illicit actors are abusing decentralized finance (DeFi) services, as well as anti-money laundering (AML) and countering the financing…
In Unprecedented Action FinCEN Identifies Virtual Currency Exchange as Primary Money Laundering Concern
On January 18, 2023, the US Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) issued an order identifying the virtual currency exchange Bitzlato Limited (Bitzlato) as a “primary money laundering concern” in connection with Russian illicit finance. The order,…
Proposed Rule Lays Out Who Will Have Access to New Corporate Beneficial Ownership Information
By Evan Abrams & Dave Stetson
On December 16, FinCEN issued a notice of proposed rulemaking (NPRM) entitled “Beneficial Ownership Information Access and Safeguards, and Use of FinCEN Identifiers for Entities.” The NPRM is intended to implement the Corporate Transparency Act (CTA) and, in particular, to…
FTX: An Explainer on What Happened and What’s Next?
Reports of FTX Group’s demise has been inescapable since news first broke of potential insolvency and misuse of customer funds. This blog post provides some background on the situation as well as some thoughts on what is likely to come…
The Storm Is Here
By Jason Weinstein & Alan Cohn
With the collapse of FTX and Alameda so close on the heels of Celsius, one thing is clear – the regulatory and enforcement storm so many anticipated coming to crypto is now here. Unfortunately, regardless of what the facts surrounding…
OFAC and FinCEN Announce Enforcement Actions Against Bittrex
On October 11, 2022, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) and Financial Crimes Enforcement Network (FinCEN) announced enforcement actions against Bittrex, Inc. (Bittrex), a privately-owned digital asset trading platform based in Bellevue, Washington, for…