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Question:  USA FinCEN Proposes KYC For Withdrawing CryptoTo Private Wallets!
 USA FinCEN KYC Exchange Rules Harsh! - 2 (40%)
 USA FinCEN KYC Exchange Rules Expected! - 2 (40%)
 USA FinCEN KYC Exchange Rules No Biggie! - 1 (20%)
 USA FinCEN KYC Exchange Rules Unknowable! - 0 (0%)
 USA FinCEN KYC Exchange Rules More Info Needed! Yet! - 0 (0%)
 USA FinCEN KYC Exchange Rules No Viewpoint! - 0 (0%)
Total Voters: 5

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Author Topic: FinCEN Proposes KYC For Withdrawing Cryptocurrency To Private Wallets.12.18.20.  (Read 129 times)
Searing
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December 19, 2020, 08:12:06 AM
Merited by JayJuanGee (1), OROBTC (1), nutildah (1)
 #1


FinCEN Proposes KYC For Withdrawing Cryptocurrency To Private Wallets
by Peter Chawaga   
December 18, 2020

https://bitcoinmagazine.com/articles/fincen-proposes-kyc-for-withdrawing-cryptocurrency-to-private-wallets


Well, the proposal with less than 30 days' notice has been tossed out there. From what I can tell it only applies to in/out of USA exchanges?

Please clarify and correct me if I am wrong, please. This whole 'regulation' speak I'm not good at, in any way shape, or form! Sad

some outtakes from the above article

quote:

The proposed rule would, in effect, require bitcoin exchanges to collect, store and share personal information from users who transfer their bitcoin private keys from those exchanges to their own private wallets, as well as transaction information.

The public has until January 4, 2021 to provide written comments to this rule...

unquote

So, IF, I have this correctly. IF I want to say take USD in and out of www.coinbase.com as an example. The 'buying' and 'sellling' of Bitcoin/Crypto

on this site consists of Know Your Customer (KYC) of an ID (like driver's license front and back) and same driver's license or passport with photo ID held

up to the head of the individual who owns such, for KYC. Again, as it exists now.

So from what I can tell from the above, you'd simply have to have a Crypto Address, say BTC/Crypto whatever (I guess you could just make a new BTC

address say) and thus that is on file as your 'proper' address for in/out on Coinbase. I suppose the in/out to addresses I send stuff out on Coinbase now

are on the site anyway, so this would simply 'provide' a 'home' address of some type, at minimum, to attach to your KYC. But hell, I'd just make a 'quote'

Coinbase Bitcoin address (new) for this. I'd only tell them a 2ndary Bitcoin address if/when I wanted to cash out say a 'paper wallet' or something.

As an aside, I would suppose that I could no longer send from Coinbase directly to an 'unknown' not verified address listed on Coinbase with KYC?

Anyway, what it looks like so far. Check the article above. Am I missing some 'grand evil tweak' that is gonna bite me in the ass worse than the above?

Or is what I say above the 'gist' of it? I could probably do such easy enough if what I say only applies to USA Crypto Exchanges...like Coinbase and KYC in that I only

buy from such to HODL more BTC/Crypto dust. Again, also, should the time come I really want to move some BTC/Crypto from say a 'real' private wallet

(paper wallet) say...I'd assume you could add a said wallet to your KYC setup above and do so. The whole thing makes me feel a bit 'itchy' and seems 'sketchy'

but could what I have above be all there is to it? Limited to USA Crypto Exchanges only? Am I missing stuff or being naive on all this?

Anyway, others smarter than me on this chime in on this thread and let me know if I missed something truly evil on all this besides the 'annoyance' I see

with KYC above.

Feel free to take the poll..but again, chime in, with whatever 'twists' or such this could open up in the future or stuff I'm missing on the downside.

Brad

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December 19, 2020, 08:12:28 AM
 #2

Reserved.

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December 19, 2020, 08:35:56 AM
Last edit: December 19, 2020, 09:12:11 AM by odolvlobo
Merited by nutildah (1)
 #3

This rule is a non-starter. If places a huge burden on anyone that wants to use Bitcoin for larger transactions.

In effect, it requires customers of banks and MSBs (e.g Coinbase, etc.) to identify the source or destination of any Bitcoin transaction over $3000.

So, let's say that a person with a Coinbase account wants to buy some gold using Bitcoin. In order for Coinbase to send the coins, the person must first find out who controls the receiving address provided by the dealer, and if it is not a bank or MSB, then they must obtain the name and address of the owner of the address and report that to Coinbase.

It works the other way to. In order for Coinbase to release funds that have been sent to you, you must first find out who controls the wallet that sent you the coins, and if it is not a bank or MSB, then you must obtain the name and address of the owner of the wallet.

Note that there is no such burden for cash. If you want to pay or receive $3000 in cash, you don't have to report their name and address to your bank.

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December 19, 2020, 02:26:49 PM
 #4

This rule is a non-starter. If places a huge burden on anyone that wants to use Bitcoin for larger transactions.

In effect, it requires customers of banks and MSBs (e.g Coinbase, etc.) to identify the source or destination of any Bitcoin transaction over $3000.

So, let's say that a person with a Coinbase account wants to buy some gold using Bitcoin. In order for Coinbase to send the coins, the person must first find out who controls the receiving address provided by the dealer, and if it is not a bank or MSB, then they must obtain the name and address of the owner of the address and report that to Coinbase.

It works the other way to. In order for Coinbase to release funds that have been sent to you, you must first find out who controls the wallet that sent you the coins, and if it is not a bank or MSB, then you must obtain the name and address of the owner of the wallet.

Note that there is no such burden for cash. If you want to pay or receive $3000 in cash, you don't have to report their name and address to your bank.


How are you supposed to legally pay ransomware then?

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December 19, 2020, 06:20:55 PM
 #5

We're moving towards having 2 parallel Bitcoin ecosystems - one with tight regulations, where the government will always know how many coins you own and were you send them, just like with your banks, and the one were you will be only able to do p2p transactions or use unregulated services, like crypto casinos. I think this is better than the alternative of having Bitcoin banned, because compared to that, people will have an option to legally buy/sell/spend their coins, without any fear.





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December 20, 2020, 01:44:49 AM
 #6

We're moving towards having 2 parallel Bitcoin ecosystems - one with tight regulations, where the government will always know how many coins you own and were you send them, just like with your banks, and the one were you will be only able to do p2p transactions or use unregulated services, like crypto casinos. I think this is better than the alternative of having Bitcoin banned, because compared to that, people will have an option to legally buy/sell/spend their coins, without any fear.

Point 1

But will it really be this bad? I mean say I have to show a BTC registered address...to my Crypto Exchange in the United States. Big whoop, I make a wallet address

and anything in or out on coinbase will be through this new ...easy ...peasy ...empty say paper wallet. So I sell BTC that I xfered to that wallet (legal) on Coinbase...and

it is more than 10K ...a form pops up on coinbase stating ..probably ...per usual..that this is MY self-hosted wallet and that is done...IF I buy from coinbase...the

Know Your Customer for that direction already works.

Point 2

I simply 'skip' the United States exchange on expanded KYC and simply go with KYC through say an exchange in Canada which does not have this extra step..again..

buying or selling as long as I do my cap gains and stuff for the IRS in the USA..I should be golden tax wise anyway

Point 3

People can still send you money directly say to any self-hosted (say paper wallet) you own....from say overseas mining profits more than $350 or whatever...

if it is a legit mining operation that allows me to be paid in crpto from overseas..it should have a business address and be legit. IF not....well then the process

is un-do-able for person to person stuff overseas and it will be rapidly ignored. On the other hand ...you keep track of such anyway from your end saying i got

such and such product from alibaba for a used miner and alibaba info ....as long as you report such it should be fine..if not...well ...than that means that the

USA wants to stop ALL person to person private wallet overseas to your private wallet overseas to you in USA over $350 without you getting KYC from everyone

well it won't stand IMHO.

What is 'likely' to stand in USA and elsewhere is the over $10k recieved or sent through an exchange ..the point you convert such crypto back to cash...or exchanges

once it gets to joe's coffee clutch buying a expresso machine from china and they require  you know your KYC of whomever there..well then it is just

unworkable.

Or am I missing the boat on all this and they really, really do require or want to require ALL transactions overseas over $350 to KYC the vendor at the other end and/or

the same with me sending like for gold in the USA from private paper wallet to some other guy's paper wallet of over $10k etc, etc.

I can see this from the exchange point of view of in/out back forth as exists now and KYC into cash or out of cash via exchanges or banks etc.

But under the system they may want above....PayPal does not 'check' everyone I can send cash to on PayPal..they only respond if i get ripped off...

so this would not work under PayPal or bitpay if it as I state above..so again, UN-doable..like the 2014 IRS rule of if I made BTC for 99c as a BTC founder

and bought a TV with it 8 years later for $500 I owe $499.01 in capital gains and have to keep track of each ...did not happen then....so hopefully

the Biden Administration may require stuff on a USA crypto exchange to go through your registered say BTC address and you fill lout a form that says..

'to the best of my knowledge' like for a wire xfer this is a legit bit of commerce we are doing...beyond that ...just won't work in any real manner. Again,

think it will be tweaked a lot of Republican Legislators in the USA already sent a couple letters to the regulators proposing such controls on all self-hosted

wallets as stupid and undo-able..also so frigging fuzzy and vague high likelihood a court would toss such without modification.

Then again, am I missing something really obvious they can get a regular person using USA exchanges or sending BTC or getting BTC out and about from

around the world either in sending/buying or mining such etc?

Maybe I'm just naive and they can simply put all the legalities on the individual with the wallet and make the whole process grind to a  halt for crypto in

the USA. Please comment. But the above is 1) exchange as stated on above likely to say 2) overseas being harder than just a wire xfer info likely not.

Brad



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December 20, 2020, 05:45:29 AM
 #7

This new KYC rules may hurt the industry really hard

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