The American Network for Combating Financial Crimes (FinCEN) has prepared and published a new manual, which outlined the current requirements for conducting operations “with convertible virtual currencies ” in the context of the law on bank secrecy and other regulatory documents in the field of remittances. In this way, FinCEN tries to prevent violations that lead to criminal and civil liability.
FinCEN notes that the developers of blockchain solutions and smart contracts do not fall under the requirements of banking legislation when working on their projects, and DApp in the document is understood as “decentralized software operating in a peer-to-peer network of computers supporting the operation of the blockchain platform”.
The manual states that in the case of transfer and receipt of funds through DApp, it is regulated in accordance with the same requirements as when using ATM. At the same time, after DApp is launched into operation, its owners and operators receive the status of a company providing money transfer services, and any action related to the transfer of funds through such an application must comply with the provisions of the US Bank Banking Secret.
An individual who is constantly involved in transferring money using virtual or fiat currency for profit also acts as a company providing money transfer services as a principal and must meet the requirements of the Law on Banking Secrets, including registration with FinCEN, following AML and maintaining appropriate reporting.
However, the regulation does not apply to decentralized cryptographic cards , in which users themselves are responsible for the safety of funds, as well as cryptobirds , providing a platform only for placing offers and customer requests – without access to the assets and processing payment transactions.
Recall that in April, for the first time, FinCEN fined a peer exchanger of virtual currencies for deliberately violating the law. According to representatives of the US Treasury division, California resident Eric Powers, who worked as an exchanger, violated requirements of the Banking Secrets Act (BSA) for the Money Services Business (MSB).
Publication date 10/05/2019
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