The U.S. Treasury's Financial Crimes Enforcement Network (FinCEN) has made cryptocurrency mixers a priority for money laundering, aiming to increase scrutiny of cryptocurrency transactions as digital assets are increasingly being used for money laundering and malicious financing.。

FinCEN raised issues related to cryptocurrency mixing, calling it a "major money laundering problem."。The decision was influenced by recent events, including the Hamas attack on Israel, which raised suspicions that the mixable virtual currency is increasingly being used for illegal activities.。

FinCEN to combat cryptocurrency money laundering

In response, FinCEN introduced new record-keeping and reporting requirements that require domestic financial institutions and institutions to record and report on transactions involving cryptocurrency mixers.。These platforms are safe havens for digital asset holders trying to cover up their cryptocurrency transactions。

Andrea Gacki, Director of FinCEN, said: "CVC Mix provides an important service that allows players in the ransomware ecosystem, rogue state actors and other criminals to fund their illegal activities and confuse the flow of ill-gotten gains."。

"This is the first time FinCEN has used Section 311 authorisation to target a class of transactions for a major money laundering problem, and as we have done in the traditional financial system, Treasury will work to identify and root out the illicit use and abuse of the CVC ecosystem."。"

Operation of Cryptocurrency Mixed Coin Industry Faces Regulatory Review

Last year, the United States imposed sanctions on Tornado Cash, a cryptocurrency-mixing service that has been the focus of controversy for its alleged money laundering activities.。The move by the U.S. Treasury's Office of Foreign Assets Control (OFAC) has sparked a discussion about the impact of sanctions and the challenges they pose to decentralized technologies.。

As of last year, more than $7 billion had been laundered with tornado cash since 2019, according to OFAC.。According to reports, 38 Ethereum addresses and six USDC addresses have been added to OFAC's list of Specially Designated Nationals, effectively banning U.S. cryptocurrency investors from using Tornado Cash.。

It is worth noting that FinCEN took measures to restrict the use of tornado cash by US residents in August 2022.。The action reportedly led to a legal challenge by an individual backed by cryptocurrency exchange Coinbase, which ruled in favor of the agency in August 2023.。