FinCEN Drops 2023 Crypto Mixing Proposal After Privacy And Reporting Pushback

The US Treasury’s Financial Crimes Enforcement Network (FinCEN) has withdrawn a 2023 proposal that would have treated international crypto mixing as a primary money laundering concern, citing warnings that the measure could discourage lawful privacy use and load banks and other covered firms with heavy reporting duties.

In a notice filed for Federal Register publication on October 6, 2026, FinCEN pulled both its formal finding and the attached proposed special measure.

The action closes a rulemaking first published on October 23, 2023, under section 311 of the USA PATRIOT Act.

That statute lets Treasury designate certain foreign jurisdictions, institutions, account types, or classes of transactions as presenting a primary money-laundering concern, then impose extra recordkeeping or reporting on U.S. financial institutions.

Because the mixing proposal was never finalized, the withdrawal does not alter existing Bank Secrecy Act duties.

The abandoned plan would have required covered institutions to file reports when they knew, suspected, or had reason to suspect that a convertible virtual currency transfer involved mixing inside or linked to a jurisdiction outside the United States.

“Mixing,” as FinCEN defined it, meant any facilitation that obscured the source, destination, or amount of one or more transactions, regardless of the protocol or service used.