The US Financial Crimes Enforcement Network (FinCEN) announced that they will soon propose a new regulation affecting cryptocurrencies on foreign exchanges. This proposal is separate from FinCEN’s proposal for cryptocurrency wallets recently.

 

USA stepped up on regulations

FinCEN, an office of the US Treasury Department, released a statement Thursday regarding a new filing requirement for cryptocurrencies. The statement contained the following statements:

Currently, Foreign Bank and Financial Accounts Report (FBAR) regulations do not define a foreign account holding virtual currency as a reportable type of account.

The statement adds that the bureaus “plan to propose to amend the regulations that enforce the Bank Secrecy Act (BSA) on reporting foreign financial accounts (FBAR) to include virtual currency as a reportable account type.”

 

Penalties at the door

Shehan Chandrasekera, Head of Cointracker Tax Strategy, said in a statement:

FBAR is a form that you file along with your tax return if you have over 10,000 foreign financial assets at any time of the year. There is no tax payable with this form, just an additional statement.

“Goodbye to non-US stock exchanges,” says Manatt’s lawyer, Marc Boiron. FBARs will need to be filed for non-US virtual currency accounts. ” said. Boiron said:

Failing to accidentally file an FBAR application could result in a $ 10,000 fine for each violation.

See Also
Global Bitcoin fraud

 

Are non-US cryptocurrency exchanges on target?

Duckduckgo’s strategist Adam Cochran said, “Another example of US regulatory overshoot.” says.

It’s totally crazy, but this rule will be something FinCEN will use to enforce more widely after international exchanges.

Attorney Jake Chervinsky said he believes the proposal “targets users of non-US exchanges” and “should not apply to assets under its custody.” He suggested that the reason for the proposal might be tax evasion or “bringing non-US crypto companies into compliance with the Bank Privacy Act.” FinCEN is currently trying to enforce rules regarding crypto wallets before the Trump era ends.

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