In 2019 FinCEN issued a guidance on virtual assets. The guidance emphasised that the Travel Rule is in effect. Cryptocurrency can be legally bought and sold from another person, crypto exchanges, bitcoin ATMs, and some banks throughout the United States. Overseen by FinCEN, the Bank Secrecy Act (BSA) is the primary regulation for all AML/ CFT activities within the USA.
Under the Biden Administration, the USA was focused on imposing further crypto regulations on the crypto world. Additionally, the US Securities and Exchange Commission (SEC) paid greater attention to regulating crypto markets. In fact, we saw the House pass the Financial Innovation and Technology for the 21st Century Act (FIT21) in May 2024. The act classifies digital assets based on the decentralisation of their underlying blockchains, providing much-needed clarity for the industry
With the Trump Administration, the country has adopted a proactive stance towards the cryptocurrency sector, implementing policies aimed at fostering innovation and solidifying the nation's leadership in digital finance.
In January 2025, President Trump issued an Executive Order to establish regulatory clarity for digital financial technology. This order created the Presidential Working Group on Digital Asset Markets, tasked with developing a comprehensive federal regulatory framework for digital assets, including stablecoins. The order also prohibited federal agencies from issuing or promoting CBDCs, emphasising a preference for decentralised digital assets and private-sector innovation.
In March 2025, we saw further movement when the President signed an Executive Order to establish a Strategic Bitcoin Reserve and a US Digital Asset Stockpile. The Strategic Bitcoin Reserve is designed to centralise and manage bitcoin assets seized through forfeiture, treating them as strategic reserves. The US Digital Asset Stockpile encompasses other digital assets obtained similarly. This is another initiative aimed at positioning the United States as a leader in digital assets.
Who are the supervisory bodies for VASPs in the US?
FinCEN plays an essential role in regulating cryptocurrencies within the USA. However, different cryptocurrency activities are regulated by various US agencies.
Financial Crimes Enforcement Network (FinCEN) is responsible for the regulation of crypto assets for AML/CFT purposes,
US Securities and Exchange Commission (SEC) oversees regulated crypto asset-considered securities by applying the Howey Test,
Commodity Futures Trading Commission (CFTC) regulates virtual assets, which are considered commodities (BTC + ETH),
Officer of the Comptroller of Currency (OCC) is responisble banks participating in the crypto ecosystem,
Internal Revenue Service (IRS) is responsible for tax collection,
Federal Bureau of Investigations (FBI) is responsible for crime enforcement at a federal level,
Office of Foreign Assets Control (OFAC) is responsible for overseeing compliance of the US cryptocurrency regulation involving sanctions.
What is the Travel Rule threshold in the US (FinCEN)?
FinCEN: USD 3000. There is an ongoing proposal to lower this amount to USD 250 for funds entering or leaving the USA.
What is the scope of the Travel Rule in the US?
The proposed Travel Rule would apply to virtual assets in the context of:
US Exchanges,
Trading Desks,
ATM’s,
Custody Providers (in the future).
As per cryptocurrency regulations in the USA, virtual assets can be classified as
Cryptocurrencies, for example, Stablecoins,
Crypto-securities, for example, Bitcoin and EFTs,
Crypto commodities, for example, BTC and ETH and so forth.
What are FinCEN's requirements for Travel Rule information to be exchanged?
originator’s name,
originator's account number (when available),
originator's address,
originator's financial institution,
transfer amount and date.
beneficiary’s name (when available),
beneficiary’s account number (when available),
beneficiary's address (when available),
beneficiary's financial institution.
The virtual asset service provider (VASP) is to keep copies of all payments and transfers performed by the customer. The regulation’s text does not confirm how the information is to be collected, verified or transferred.
When do you need to comply with the Travel Rule in the US?
Now.
The Travel Rule has been in action since 2013 but has not been heavily enforced. The Biden Administration worked towards a more regulated crypto market. While not directly confronting the crypto market, a Bill was signed in 2021 stating that all VASPs will need to track and report transactions to the IRS as of 2023.
Which regulations are applicable to the US Travel Rule?
Department of the Treasury Semiannual Agenda
What else do you need to know about the Travel Rule in the US?
While the FATF uses the terms virtual asset and virtual asset service provider FinCEN makes use of the terms convertible virtual currency (CVC) and money services business (MSB). Moreover, the terms transmitter and receiver replace the terms originator and beneficiary. Lastly, a (virtual asset) transfer is referred to as a transmittal order.
Cryptocurrency exchanges that do not register as an MSB will be in breach of the Bank Secrecy Act and AML/CFT regulations.
Crypto fund managers who invest in crypto futures must be licenced by the Commodity Futures Trading Commission (CFTC) as Commodity Trading Advisors and Commodity Pool Operators.
Cryptocurrency is taxed under capital gains or loss (if the virtual assets are held for less than a year, short-term capital gains are applied, and the opposite for long-term investments). Moreover, cryptocurrency is classed as property.
US taxpayers must retain detailed records for crypto transactions and report this to the IRS.
The IRS taxes cryptocurrency mining and payment for services/goods with cryptocurrency as income.
