The regulatory climate in the United States with regards to the cryptocurrency industry appeared to be taking a more and more critical stance as opposed to other countries around the world.
The Financial Crimes Enforcement Network [FinCEN], the bureau of the US Department of the Treasury, has been in the news for its contentious proposal for self-hosted wallets. One of the first platforms to have responded to it was Coinbase which has asked the watchdogs to extend the comment period to the traditional 60 days.
In a letter shared with Kenneth Blanco, the Director of FinCEN, Coinbase’s Chief Legal Officer stated that it had asked the public to provide comments in just 15 days, which spans Christmas Eve, Christmas Day, New Year’s Eve, and New Year’s Day, amidst of a global pandemic leaving just a few of actual working days for comments as opposed to the regular period of 60 days.
According to the FinCEN’s proposed rule, the general public will have until the 4th of January 2021, to offer comments and feedback which has been vehemently opposed by Coinbase stating that there was no need for the urgency.
The exec urged FinCEN to reconsider its haste and provide the typical period for such significant proposed rulemaking which entails new and “onerous” reporting and recordkeeping requirements for cryptocurrency transactions.
Blanco further questioned the “rushed effort” by FinCEN in this particular case especially when the agency had asked for comments on 24 separate questions [over three pages of the notice]. After conducting an initial review over the weekend, Coinbase found that responding to those issues will require pursuing detailed technical analyses, extensive cost assessments, and complex balancing of privacy interests for the users who would now have to furnish detailed personal information for transactions.
Blanco also said that FinCEN does not provide any details with regards to the current expedited timeline as to why such a need arose in the middle of a pandemic as well as coincidentally just when the current administration is set to leave the office. He went on to add,
“There is no emergency here; there is only an outgoing administration attempting to bypass the required consultation with the public to finalize a rushed rule before their time in office is done. There is also no justification for treating the cryptocurrency industry so differently from our counterparts in traditional finance.”
This news comes two days after Coinbase’s CEO and Co-founder, Brian Armstrong said that the proposed rule does not follow the correct process and revealed to challenge it.