US Treasury Department Not Trying to Ban Crypto Mixers, Top Official Says
FinCEN's 2023 proposal to require crypto companies to report transactions involving mixing is about transparency, not banning mixers, said Brian Nelson, deputy secretary of the US Treasury.
Speaking at CoinDesk’s annual Consensus conference in Austin, Brian Nelson – Under Secretary of the Treasury for Terrorism and Financial Intelligence – discussed the 2023 Financial Crimes Enforcement Network (FinCEN) proposal to classify mixers as a “major money laundering concern” and require virtual asset service providers (VASPs) ) to report any crypto transactions involving mixing to the agency.
FinCEN's proposal – along with a growing number of enforcement actions taken by the US Department of Justice against mixing services including Tornado Cash and Samourai Wallet – has been seen by many in the industry as evidence of an impending effort to ban crypto mixing in the US entirely. which the Treasury Department categorically denies.
“Ultimately, this [proposal] is not a ban on mixers,” Nelson said. “This is a proposed rule designed to promote transparency.”
Nelson said he was sympathetic to crypto users' desire for financial privacy, but suggested that the industry and Treasury should work together to find ways to increase privacy without enabling terrorist financing.
“From our perspective, we believe that there is a difference between privacy-enhancing obfuscation and anonymity-enhancing services – we are of course fully aware that, in the context of public blockchains… that there will be a desire to have some level of privacy,” Nelson said. “In that spirit, we want to work with industry to identify and collaborate on tools that can improve privacy.”