The U.S. Treasury Department and the Federal Reserve have withdrawn a 2020 rule proposal that would have expanded recordkeeping and information-sharing requirements around certain cross-border transfers, including some cryptocurrency transactions.

The plan would have reduced the reporting threshold from $3,000 to $250 for certain funds transfers that begin or end outside the United States. It also sought to clarify that existing Recordkeeping and Travel Rules apply to transactions involving convertible virtual currency and digital assets with legal tender status.

What the 2020 proposal would have changed

The proposal was issued jointly in October 2020 by the Financial Crimes Enforcement Network, or FinCEN, and the Federal Reserve. Its main operational change was a much lower threshold for when financial institutions must collect, retain, and transmit information tied to certain international transfers.

Under the proposal, the trigger for those requirements would have fallen from $3,000 to $250 when a covered funds transfer starts or ends outside the United States. The agencies also proposed language clarifying that the existing Recordkeeping and Travel Rules cover transactions involving convertible virtual currency and digital assets with legal tender status.

Why the rule drew opposition

The proposal had been criticized as a significant expansion of financial surveillance. Coin Center argued that lowering the threshold so sharply would pull more routine transactions into a system of warrantless monitoring.

According to the group, the agencies did not sufficiently account for the privacy costs such a change could impose on individuals. The criticism focused not only on the lower dollar threshold but also on the broader extension of Bank Secrecy Act monitoring to more crypto-related activity.

Agencies end the rulemaking

Treasury and the Federal Reserve have now decided not to move forward with the proposal. Instead of finalizing the rule, they withdrew it outright.

The agencies said that if they pursue a similar measure in the future, they would need to start over with a new public comment process. That means the 2020 proposal will not advance in its current form.

Part of a broader pullback

The withdrawal follows Treasury’s earlier decision to pull back proposed rules concerning unhosted wallets and cryptocurrency mixing. In the source article’s framing, these decisions collectively shut down several long-pending efforts to widen the scope of Bank Secrecy Act surveillance.

For now, the confirmed next step is procedural rather than substantive: any renewed attempt to revive similar reporting or recordkeeping changes would require a fresh proposal and another round of public input.

Source: www.coincenter.org