From Uncertainty toward Regulatory Clarity: Senior SEC Officials Provide Regulatory Clarity for Digital Assets

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On June 14, 2018, the Director of the Division of Corporation Finance of the Securities and Exchange Commission delivered a speech outlining the framework used by the SEC Staff in

In a recently published letter to the Senate Finance Committee, FinCEN confirmed that when an ICO token is a “convertible virtual currency,” administrators or exchangers of the token would be “money transmitters” under existing FinCEN regulations and interpretations.

Under the Bank Secrecy Act (BSA), a money transmitter must register with FinCEN as a money services business (MSB) and implement a risk-based anti-money-laundering (AML) compliance program. Pursuant to the BSA and its implementing regulations, an appropriate AML compliance program will include certain mechanisms for meeting the MSB’s transaction monitoring, reporting, and recordkeeping obligations—obligations that, in effect, require the MSB to know your customer. FinCEN’s letter to the Senate Finance Committee indicates that the agency is closely monitoring ICO tokens, as well as the developers and trading platforms that are issuing and exchanging ICO tokens, for BSA violations and trends or risks of associated money laundering, terrorist financing, and other financial crimes.
Continue Reading FinCEN Is Watching ICOs for BSA Violations