General information only. CryptoRegHub provides summaries for informational purposes and does not constitute legal or compliance advice. Always verify with official sources and consult qualified legal counsel before making compliance decisions.
CryptoRegHub provides plain-English summaries of crypto regulations for informational purposes only. This does not constitute legal, compliance, or financial advice. Regulations change frequently — always verify information with official sources and consult qualified legal counsel before making any compliance decisions.
Under the Bank Secrecy Act (BSA) and FinCEN's regulations, crypto businesses that accept and transmit value — including centralised exchanges, custodial wallet providers and certain DeFi platforms — are classified as "money services businesses" (MSBs) and specifically as "money transmitters." FinCEN clarified in 2013 that virtual currency exchangers and administrators are MSBs. As of 2020, FinCEN extended BSA obligations to certain non-custodial wallet interactions. The GENIUS Act reinforces this by treating payment stablecoin issuers explicitly as financial institutions under the BSA. FinCEN's Travel Rule (31 CFR 1010.410) requires money transmitters to collect and transmit originator/beneficiary information on transfers of USD 3,000 or more.
Who does it apply to?
Applies to any business in the United States (or doing business substantially within the US) that: exchanges virtual currency for real currency or other virtual currencies; or transmits virtual currency as a business. This includes centralised crypto exchanges, crypto ATM operators, custodial wallet providers, and certain DeFi platforms where a centralised party has control. Peer-to-peer users transacting for their own purposes are generally not in scope. Non-custodial wallet software providers are generally not MSBs absent other factors.
Key requirements
Key requirements: (1) Registration with FinCEN as a money services business (MSB) — renewal every two years. (2) Written AML programme covering: internal controls, independent audit, designation of a compliance officer, ongoing employee training. (3) Customer Identification Programme (CIP) — verify identity of customers at account opening. (4) Suspicious Activity Reports (SARs): file with FinCEN within 30 days of detecting a transaction of USD 2,000 or more that involves suspected illegal activity. (5) Currency Transaction Reports (CTRs): report transactions of over USD 10,000 in cash. (6) Travel Rule (31 CFR 1010.410): for transfers of USD 3,000 or more, must obtain and retain full originator and beneficiary information and transmit it to the receiving institution. (7) OFAC sanctions screening: screen all customers and transactions against OFAC SDN and other sanctions lists. (8) Recordkeeping: retain transaction records for 5 years.
Obligation types
Registration
Requirement to register with a regulator
KYC / AML
Know Your Customer and Anti-Money Laundering obligations
Travel Rule compliance
Sharing originator/beneficiary data on transfers
Regulatory reporting
Ongoing reporting to regulators
Penalties & fines
Civil money penalty
Operating as an unregistered MSB or wilful violation of BSA requirements
Max: Up to USD 25,000 per day per violation
Applies to: Crypto exchanges and MSBs
Criminal penalty
Wilful failure to maintain AML programme, file SARs, or register as MSB
Max: Up to USD 250,000 fine and/or up to 5 years imprisonment
Applies to: Individuals and entities
Pattern of violations
Wilful violation as part of a pattern of illegal activity involving over USD 100,000 in a 12-month period
Max: Up to USD 500,000 fine and/or up to 10 years imprisonment
Applies to: Individuals and entities
Implementation timeline
Mar 2013
FinCEN issued guidance classifying virtual currency exchangers as MSBs
FIN-2013-G001 established that convertible virtual currency exchangers and administrators are money transmitters subject to BSA.
May 2019
FinCEN issued updated guidance on application of BSA to crypto businesses
FIN-2019-G001 provided comprehensive guidance covering ICOs, DEXs, anonymity-enhanced cryptocurrencies, wallets and other business models.
Dec 2020
FinCEN proposed rule extending Travel Rule to unhosted wallets
NPRM proposed reducing Travel Rule threshold to USD 250 for transfers involving unhosted wallets. Rule was not finalised.
Apr 2026
FinCEN proposes broad AML framework overhaul
FinCEN issued a proposed rule outlining significant changes to the AML regulatory framework across BSA-covered institutions, including banks, money services businesses, credit card issuers, casinos, and loan and finance companies.
Apr 2026
FinCEN and OFAC propose AML/CFT and sanctions framework for stablecoin issuers
Joint notice of proposed rulemaking implementing the anti-financial-crime provisions of the GENIUS Act. Would treat permitted payment stablecoin issuers as financial institutions under the BSA via a stand-alone framework at 31 CFR Part 1033. Comments closed 9 June 2026.
Always refer to official sources to confirm current requirements. CryptoRegHub summaries are for general guidance only.
Updates & news
8 April 2026
FinCEN and OFAC propose stand-alone BSA framework for stablecoin issuers
A joint notice of proposed rulemaking would implement the GENIUS Act's anti-financial-crime provisions, treating permitted payment stablecoin issuers as financial institutions under the Bank Secrecy Act through a new stand-alone framework at 31 CFR Part 1033 rather than the existing money-transmitter route. Comments closed 9 June 2026. Separately, on 7 April 2026 FinCEN proposed a broad overhaul of the AML framework across BSA-covered institutions.
Frequently asked questions
At a glance
JurisdictionUnited States
RegulatorFinCEN
Official nameBank Secrecy Act (31 USC 5311 et seq.) + FinCEN regulations (31 CFR Chapter X)
StatusIn Force
Enacted26 Oct 1970
Effective from18 Mar 2013
Last verified22 Jul 2026
Penalty severity
● High risk
Large fines, licence revocation, or criminal referral risk
This summary is for general informational purposes only and does not constitute legal advice. Always verify with official sources and consult qualified legal counsel.