FinCEN and the Federal Reserve announced on Nov. 6 that they are withdrawing a rulemaking proposal that would have lowered the crypto‑transfer reporting threshold from $3,000 to $250. The joint notice, published in the Federal Register on Nov. 9, confirms that the proposal never took effect and that existing U.S. obligations remain unchanged.

What the withdrawal means for U.S. crypto firms

According to CryptoSlate, the 2020 proposal sought to expand record‑keeping and information‑transmission duties to cross‑border crypto payments as low as $250. With the withdrawal, U.S. covered institutions continue to apply the Travel Rule only to transfers of $3,000 or more, as set out in FinCEN’s 2019 virtual‑currency guidance. Money transmitters must still maintain AML programs, customer‑identification controls and related monitoring, but they are not required to collect the additional data for smaller transfers.

EU regulations still affect small cross‑border payments

The European Union’s crypto‑transfer regulation, effective Dec. 30, 2024, imposes information‑sharing duties on any crypto‑asset service provider registered in the EU, regardless of transaction size. CryptoSlate explains that a hypothetical $500 transfer from a U.S. exchange to an EU‑based exchange would still trigger EU obligations. The receiving provider must obtain sender and recipient names, blockchain addresses, identification documents and other details before releasing the assets. If required data are missing, the EU provider must either reject, return, or suspend the transfer under Article 17.

How the split jurisdiction plays out in practice

In the example cited by CryptoSlate, the U.S. exchange would meet its domestic record‑keeping duties, but the EU exchange would still need to verify the information before crediting the customer’s account. This creates a situation where the blockchain transaction is confirmed, yet the recipient cannot access the funds until the EU provider’s compliance checks are satisfied. The regulation also adds an ownership‑or‑control assessment for transfers exceeding €1,000, but smaller amounts like $500 remain subject to the general information requirements.

What to watch next

Regulators may revisit the threshold in future rulemaking cycles, especially as public feedback and market conditions evolve. Market participants should monitor any new guidance from FinCEN or the European Banking Authority that could modify the scope of the EU crypto‑transfer rules. Additionally, firms operating across the Atlantic will need to maintain dual compliance frameworks to avoid delays or rejections of cross‑border payments.