The most popular Initial Coin Offering (ICO) operators and the ones that were here for a while have always known that the law will eventually get to them. This just started happening in the US where the Department of the Treasury suggested that ICOs may be a subject to criminal statutes that are governing money transfer businesses.
The letter was primarily addressed to Senator Ron Wyden and sent in February 2018 – but released this Tuesday. In it, the companies that sell “convertible virtual currencies” must comply with the bank secrecy and know-your-customer guidelines as well as the rules that have been put in place in order to combat money laundering.
As the letter states:
“Generally, under existing regulations and interpretations, a developer that sells convertible virtual currency, including in the form of ICO coins or tokens, in exchange for another type of value that substitutes for currency is a money transmitter and must comply with AML/CFT requirements that apply to this type of MSB [money services business].”
Many experts have shared their views on the possible interpretation of taxes and money transfer laws. According to Peter Van Valkenburgh, the head of research at Coin Center, any ICO that involves US residents and is not registered with the Financial Crimes and Enforcement Network (FinCEN) could be charged under the US law for a federal felony.
According to Bloomberg, some ICOs already registered with FinCEN in order to protect themselves against any money transfer regulations.
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