Policy & Law
The US Treasury Department's Financial Crimes Enforcement Network (FinCEN) issued guidance earlier this year outlining how virtual currencies like Bitcoin should be regulated. According to the guidelines as originally interpreted, both companies and individuals trading in the cryptocurrency would need to register with the US government as money-services businesses, putting a great burden on those only mining Bitcoin for themselves. Now, according to correspondence sent to one Bitcoin company, FinCEN has clarified its language to let miners off the hook.
No need to register if you mine Bitcoin for yourself alone
According to Bitcoin blog CoinText, FinCEN gave the clarification to Atlantic City Bitcoin, a facility that operates hardware for miners in New Jersey. In the letter, the bureau explains, "To the extent that a user mines Bitcoin and uses the Bitcoin solely for the user’s own purposes and not for the benefit of another, the user is not an MSB under FinCEN’s regulations, because these activities involve neither "acceptance" nor "transmission" of the convertible virtual currency and are not the transmission of funds..." The letter goes on to explain that users who transmit or convert funds for second parties would still have to register.
The news should come as some relief to organizations like the Bitcoin Foundation, which voiced displeasure when FinCEN made the rulings back in March. Patrick Murck, general counsel for the foundation, commented at the time that compliance with anti-money laundering laws written for real-world money transmitters would be "infeasible for many, if not most members of the Bitcoin community."
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