New Regulation Mandates Collection of US Crypto User Data by Businesses

The US government is set to implement a new regulation that will require businesses to collect personal information on users conducting cryptocurrency transactions exceeding $10,000. The regulation, which was passed as part of the Infrastructure Investment and Jobs Act, is scheduled to go into effect on January 1, 2024.

The regulation is intended to help the government track cryptocurrency transactions for tax purposes. However, it has also raised privacy concerns among some members of the crypto community. Critics argue that the regulation could be used to track the movements of individuals who are using cryptocurrency to engage in illegal activities.

The crypto industry has already filed a legal challenge against the regulation. Coin Center, a non-profit organization that advocates for the rights of crypto users, filed a lawsuit against the Treasury Department in December 2021. The lawsuit argues that the regulation violates the Fourth Amendment’s protection against unreasonable searches and seizures.

It is unclear how the legal challenge will be resolved. However, the regulation is likely to have a significant impact on the crypto industry in the United States. Businesses that fail to comply with the regulation could face fines of up to $250,000 per violation.

The regulation is also likely to have a chilling effect on the use of cryptocurrency in the United States. Some users may be reluctant to use cryptocurrency if they know that their personal information will be collected by businesses. This could make it more difficult for businesses to accept cryptocurrency payments and could slow the adoption of cryptocurrency in the United States.