The Financial Crimes Enforcement Network (FinCEN) and the Federal Reserve have formally withdrawn a 2020 proposal that would have lowered the Bank Secrecy Act threshold for cross-border funds transfers from $3,000 to $250. The notice, published Monday in the Federal Register, states that the agencies will not take further action on the rulemaking initiative first issued on October 27, 2020.
The withdrawal leaves the existing $3,000 threshold for collecting and transmitting customer information in place. Under current regulations, banks and nonbank financial institutions must collect, retain and pass along customer data on transfers of $3,000 or more. The decision also halts plans to clarify the definition of money to explicitly cover convertible virtual currency and digital assets with legal tender status.
Regulators cite market changes
In the notice, FinCEN and the Fed cited the passage of more than five years since the original proposal as a primary reason for the withdrawal. The agencies stated that additional public feedback would be necessary before adopting similar rules, aiming to provide certainty that no final rule would be issued without another opportunity for comment.
The regulators also pointed to the maturation of crypto markets and the emergence of new legal frameworks. Specifically, they referenced the GENIUS Act stablecoin law, which was enacted on July 18, 2025. Under this legislation, the Federal Reserve proposed customer identification requirements for stablecoin issuers in June, while FinCEN and the Treasury’s sanctions office proposed anti-money-laundering programs for these firms in April.
Industry opposition and comments
During the comment period, FinCEN and the Fed received nearly 3,000 submissions, most of which were substantially similar form letters opposing the lower threshold. Commenters argued that the change would burden smaller institutions and could push consumers sending remittances toward less regulated channels. Many noted that potentially illicit transfers below $3,000 were already being flagged through suspicious activity reports, with some suggesting the threshold should rise instead due to inflation since 1995.
Crypto service providers and their trade groups opposed the proposed language regarding virtual currencies, citing technical limits and the lack of an international messaging standard for crypto transfers. Conversely, some banks and money services businesses supported the clarification. The withdrawal does not repeal or amend any existing rule, meaning the decades-old $3,000 threshold and the current Travel Rule remain unchanged.
This move follows other recent regulatory shifts. On October 6, FinCEN scrapped its 2020 unhosted wallet proposal and a 2023 plan to label international crypto mixing a primary money laundering concern, a step Coin Center characterized as a significant victory for financial privacy. Meanwhile, enforcement actions continue, with FinCEN cutting off the MEXC exchange from the U.S. financial system on Friday over alleged sanctions evasion.
