U.S. Treasury withdraws proposed rules on self-hosted wallets, crypto mixers

The U.S. Treasury Department’s Financial Crimes Enforcement Network, or FinCEN, has withdrawn existing proposed rules on self-hosted wallet transactions and crypto mixing, Zoomer News reported. The withdrawn proposals included the so-called Travel Rule proposal tied to self-hosted wallets and a separate proposal targeting crypto mixing transactions. The self-hosted wallet proposal had called for financial institutions to collect, keep and report additional identity information on virtual asset transactions over $10,000. Market participants see the move as easing long-running regulatory uncertainty around self-custody and DeFi, while a lower compliance burden on transactions involving non-custodial wallets could support on-chain activity and demand for self-custody, according to the report.