Coinbase, one of the largest cryptocurrency exchanges in the world, was recently given a notice by the Financial Crimes Enforcement Network (FinCEN) of new regulations entitled “Requirements for Certain Transactions Involving Convertible Virtual Currency or Digital Assets.”
This rule would require additional reporting and record-keeping requirements, something that would require significant changes and adaption on Coinbase’s end.
FinCEN only gave Coinbase 15 days to reply to with a comment, significantly shorter than what Coinbase views as the industry standard.
Written and emailed directly to the Director of FinCEN, Kenneth Blanco, the Coinbase response states;
“FinCEN asked the public to provide comments in just 15 days, spanning Christmas Eve, Christmas Day, New Year’s Eve, and New Year’s Day, in the middle of a global pandemic — leaving just a handful of actual working days for comments. Because we have historically enjoyed and valued a productive working relationship with FinCEN, this recent development is an unfortunate and disappointing departure. […] We, therefore, ask that FinCEN reconsider its haste and provide the typical 60-day period for such significant proposed rulemaking.”
Coinbase has gone right to the top and requested an extension four times the length it was initially given.
At this time, it’s not clear why FinCEN offered Coinbase just 15 days to respond, especially during the busy holiday season.
Representatives stated that the three pages of questions asked by FinCEN cannot be answered in this short of a time period. Coinbase claims that it needs the standard 60 days to consult with other industry leaders as well as take the time to thoroughly analyze and report back.
These potential new regulations come at an unfavorable time for the exchange, especially considering that it’s getting ready to launch its IPO in early 2021. Once the IPO commences, Coinbase will be the first cryptocurrency exchange to be listed for public trading on the stock exchange.