FinCEN Deals Major Regulatory Blow to ICOs and Exchanges

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The U.S. Securities and Exchange Commission (SEC) has been proclaiming for a while that initial coin offerings (ICOs) are securities. Now, in the latest regulatory backlash against ICOs, the federal bureau charged with enforcing the nation’s laws against money laundering has decided that, effectively, anyone who sells tokens is an unregistered money transfer business.

Financial Crimes Enforcement Network (FinCEN) made public a letter on March 6, 2018, that Drew Maloney, FinCEN’s assistant secretary for legislative affairs, sent to U.S. Senator Ron Wyden last month.

The letter summarizes FinCEN’s interpretation of the current laws and regulations as they relate to ICOs. According to FinCEN, anyone issuing an ICO is a money transmitter subject to the Bank Secrecy Act. As such, they are

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