US FBI Warning on Unregistered Crypto Money-Transmitting Services
The US Federal Bureau of Investigation (FBI) has issued a warning to Americans regarding the use of crypto money-transmitting services that are not registered as Money Services Businesses (MSBs) in accordance with United States federal law. These laws mandate adherence to anti-money laundering requirements.
FBI Urges Caution When Using Cryptocurrency Services
In a statement released by the FBI’s Internet Crime Complaint Center (IC3), individuals are urged to avoid crypto services offered by entities not registered as MSBs under federal law and failing to adhere to anti-money laundering (AML) regulations.
- The FBI emphasizes the importance of taking precautionary measures to avoid inadvertently engaging with non-compliant services.
- Avoid crypto money-transmitting services that fail to collect Know Your Customer (KYC) information from customers when required.
- Prior to utilizing a crypto money-transmitting service, verify their registration as an MSB with the US Treasury Department’s Financial Crimes Enforcement Network (FinCEN).
US Government Intensifies Crackdown on Crypto Mixers
The US government has escalated its crackdown on crypto mixers in recent years. Following various incidents, including the Axie Infinity hack and the Hamas attack on Israel, regulatory actions have been taken against services facilitating money laundering activities.
- In May 2022, sanctions were imposed on Blender.io by the Treasury Department’s Office of Foreign Asset Control (OFAC).
- In October 2022, addresses linked to the Tornado Cash mixer were added to the list of Specially Designated Nationals, prohibiting US residents from using the service.
- By August 2023, all three co-founders of Tornado Cash were arrested following legal challenges.
In October 2023, the Treasury’s Financial Crimes Enforcement Network proposed labeling crypto mixers as a “primary money laundering concern.” Recent arrests of the founders and CEO of Samourai Wallet further demonstrate the government’s commitment to combating illicit activities in the crypto space.
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
