The crypto wallet rule proposed by the U.S. Treasury Department is unconstitutional, warns the Civil Rights Group – Regulation Bitcoin News
The New Civil Liberties Alliance has objected to FinCEN’s proposed Crypto Wallet rule, calling it “illegal”. In addition, the group says the Treasury’s “planned” crackdown on the private wallets of cryptocurrency holders is an unconstitutional takeover. “
According to the NCLA, the Crypto Wallet rule proposed by FinCEN is illegal
The New Civil Liberties Alliance (NCLA), a non-partisan, nonprofit civil rights group, filed its position on Monday against FinCEN’s proposed rule entitled “Requirements for Certain Transactions in Convertible Virtual Currency or Digital Assets”. The Financial Crimes Enforcement Network (FinCEN) is an office of the US Treasury Department.
The NCLA warned:
The US Treasury’s proposed “crackdown” on the private wallets of cryptocurrency holders is an unconstitutional takeover … The proposed rule represents a radical – and unlawful – expansion of FinCEN’s financial oversight.
Calling FinCEN’s proposal “large-scale government interference in private digital transactions,” the group claims that its “unlawful requirements … would result in massive collection of people’s personal information” and “likely to drive privacy-sensitive digital assets out of the US.” would “banking system. “
Under the proposal, “digital assets would fall under the category of regulated currencies for monetary instruments,” stated the NCLA. This means that private data is collected from Bitcoin and other crypto users in accordance with the requirements of the Bank Secrecy Act (BSA) for keeping records and reporting currency transactions.
In addition, the rule proposed by FinCEN “sets in motion a chain reaction of mandatory disclosure of personal data,” described the NCLA. For example, if a financial institution conducts a transaction with a person in cryptocurrencies worth more than $ 3,000, it must keep detailed records of both the customer and the counterparty, even if the person is using a non-hosted wallet. The NCLA pointed out that “even existing BSA requirements for traditional banks do not require this disclosure about counterparties.” The Allianz argues:
The proposed rule transcends reasonable constitutional boundaries by empowering FinCEN to exercise the exclusive legislative power of Congress.
The group further stated that “the proposed rule violates the fourth amendment by expanding the scope of the BSA to require the submission of sensitive financial information from individuals who have never voluntarily disclosed it to a financial institution and such as cryptocurrency holders have been banned from it The reach of BSA. “The NCLA stressed that” it would unconstitutionally require the disclosure of private information to law enforcement agencies without suspicion of wrongdoing, “and subsequently called on the FinCEN to” recognize the constitutional limits of its authority and cease its unlawful legislation. “
Caleb Kruckenberg, Attorney General of the NCLA, commented:
The rule proposed by FinCEN illegally seeks to convert the agency’s limited power to regulate banks into permission to financially monitor innocent individuals who only use digital assets. FinCEN should recognize that its proposal would be grossly unconstitutional and remove this rule immediately.
Do you agree with the NCLA regarding FinCEN’s crypto rule? Let us know in the comments below.
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