US Crypto Ban
Cryptocurrency is a digital asset that uses cryptography to secure its transactions and control the creation of new units. Cryptocurrencies are decentralized, meaning they are not controlled by any single entity or government. As such, governments around the world have begun to take steps in regulating their use. One of those efforts has been focused on banning cryptocurrencies in the United States (US).
In July 2019, US President Donald Trump issued an executive order prohibiting Americans from buying Venezuelan cryptocurrency Petro as part of economic sanctions against Venezuela’s government. This was followed up by another executive order from President Trump which declared that all US-based organizations should stop transacting with all foreign cryptocurrencies within 45 days starting October 2018 . The order also stated that financial institutions would be required to report any activities involving foreign cryptocurrencies owned or operated by American citizens or companies back to Treasury Department’s Office of Foreign Assets Control (OFAC). These orders marked a major shift in policy for the US as it was one of few countries actively pursuing a ban on cryptocurrency transactions within its borders.
Since then, there has been confusion surrounding how these regulations apply and who they affect. To clear this up, the Financial Crimes Enforcement Network (FinCEN) released guidance in May 2019 clarifying certain aspects related to crypto trading and mining operations conducted inside the US:
– All persons engaged in crypto trading must register with FinCEN as Money Services Businesses; – All miners must obtain licenses before engaging in mining activities; – Brokers/dealers dealing with cryptos must comply with customer identification requirements under Bank Secrecy Act (BSA); – Exchanges providing services for conversion between fiat currencies and virtual assets must also register with FinCEN as Money Service Businesses; – Exchanges should ensure compliance with anti-money laundering obligations when facilitating transfers between fiat currency and virtual assets; – Regulated exchanges should ensure strict enforcement for detecting suspicious activity reports associated with money laundering activities; – Exchange operators need to implement robust internal controls including KYC procedures at account opening stage along