
AUSTIN,
Texas
–
The
U.S.
Department
of
the
Treasury
is
not
attempting
to
ban
cryptocurrency
mixing
services,
a
top
official
said
Wednesday.
Speaking
at
CoinDesk’s
annual
Consensus
conference
in
Austin,
Brian
Nelson
–
the
Treasury’s
Under
Secretary
for
Terrorism
and
Financial
Intelligence
–
addressed
the
Financial
Crimes
Enforcement
Network’s
(FinCEN’s)
2023
proposal
to
classify
mixers
as
a
“primary
money
laundering
concern”
and
require
virtual
asset
service
providers
(VASPs)
to
report
any
crypto
transactions
that
involved
mixing
to
the
agency.
FinCEN’s
proposal
–
along
with
an
increasing
number
of
enforcement
actions
by
the
U.S.
Department
of
Justice
against
mixing
services
including
Tornado
Cash
and
Samourai
Wallet
–
have
been
seen
by
many
in
the
industry
as
evidence
of
a
coming
attempt
to
ban
crypto
mixing
in
the
U.S.
entirely,
which
the
Treasury
is
firmly
denying.
“At
the
end
of
the
day,
this
[proposal]
is
not
a
ban
on
mixers,”
Nelson
said.
“This
is
a
proposed
rule
designed
to
drive
transparency.”
Nelson
said
he’s
sympathetic
to
crypto
users’
desires
for
financial
privacy,
but
suggested
that
the
industry
and
Treasury
should
work
together
to
find
ways
to
enhance
privacy
without
enabling
terrorist
financing.
“From
our
perspective,
we
believe
that
there
is
a
difference
between
obfuscation
and
anonymity
enhancing
services
that
support
privacy
–
we
of
course
totally
recognize
that,
in
the
context
of
public
blockchains…that
there
would
be
a
desire
to
have
a
certain
degree
of
privacy,”
Nelson
said.
“In
that
spirit,
we
want
to
work
closely
with
industry
to
identify
and
collaborate
on
tools
that
can
enhance
privacy.”
Nelson
said
that
the
majority
of
mixers
he’s
seeing
are
not
actually
created
to
enhance
privacy,
but
are
made
to
skirt
anti-money
laundering
(AML)
and
know-your-customer
(KYC)
reporting
requirements,
thus
making
them
“very
attractive”
to
bad
actors,
including
North
Korea.
“It’s
not
that
everybody
needs
to
know
who
you’re
transacting
with,”
Nelson
said
–
just
that
people
and
VASPs
alike
need
to
know
they’re
not
“unwittingly”
funding
Hamas
or
North
Korea’s
weapons
program.