Pat Toomey is the US Senator. He discussed cryptocurrencies in the letter. He says that cryptocurrencies stand to improve consumer privacy dramatically. They also provide access to financial services and the power to make decisions for themselves.
The letter mainly raises concern with two proposals. These proposals involve the treasury department. The department is related to the cryptocurrency’s regulation and oversight.
Concerns
The first concern is about FinCEN’s proposed rule for certain cryptocurrency transactions. In addition, the second one regards FATF cryptocurrency guidance and VASPs.
Fintech is evolving rapidly.
Fintech holds the promise to expand consumer’s choices. It also increases personal privacy. Moreover, Fintech builds a better future for Americans with limited or zero access to traditional financial services. Cryptocurrencies played a prominent role in the rise of fintech.
Moreover, cryptocurrency helps to connect one person with another through open public networks. Some people are arguing that cryptocurrency is a technology that would be revolutionary, like the internet.
FinCEN’s rule may negatively impact the US.
The proposal imposes several requirements on cryptocurrency transactions. However, they did not impose any requirements on US dollar transactions. All the financial institutions need to maintain records for transactions of about $3,000.
The institutions also have to report the individual’s information to the FinCEN’s personal information for all the transactions above $10,000.
Existing Requirements
However, the existing requirements are not appropriately tailored to identify illegal activities. The treasury should utilize this opportunity. It should consider whether the present record-keeping and reporting requirements are apt for the US dollar transactions.
Treasury did not update the US dollar transactions reporting requirements of some cases in more than 40 years. The National Defense Authorization Act for 2021 needs the treasury to review different thresholds for different categories of activities.
