Coinbase Slams US Treasury’s Proposed Requirement for Crypto Platforms to Report All Mixing Activities

cryptonews.com:

Coinbase has criticized the US Treasury’s proposed rulemaking on cryptocurrency mixing, stating that it fails to effectively address regulatory gaps while placing unnecessary burdens on crypto platforms.

In a comment submitted to the Treasury Department’s Financial Crimes Enforcement Network (FinCEN), Coinbase argued that regulated platforms already comply with recordkeeping and reporting rules for suspicious activities and illicit crypto mixing.

The proposed requirement for crypto platforms to report all crypto mixing activities, even those with legitimate purposes, was deemed inefficient by Coinbase.

The company expressed concerns about the excessive utilization of resources by such reporting.

Coinbase’s comment also highlighted the absence of a monetary threshold for recordkeeping and reporting, asserting that this approach would result in the bulk reporting of non-suspicious transactions.

In a post on X (formerly Twitter), Paul Grewal, Chief Legal Officer of Coinbase, emphasized the need for a more targeted approach, stating that a data dump without a monetary threshold would be a waste of time and resources.

“If Treasury wants to focus on this issue, they should help Exchanges meet their existing obligations to report suspicious activity involving mixing,” Grewal said.

He suggested that specific guidance would be more effective than mandatory bulk reporting rules, as has been done in other areas by the Treasury.

If a new rule is required, at least: A/ add a money threshold to minimize the unhelpful information reported and mitigate the heavy burden this poses on exchanges; B/ make the rule a recordkeeping – not reporting – requirement; and C/ provide an extended implementation period.…

— paulgrewal.eth (@iampaulgrewal)