Regulatory Alerts2014-04-29
Application of Money Services Business regulations to the rental of computer systems for mining virtual currency
The Financial Crimes Enforcement Network (FinCEN) issued an administrative ruling determining that a company renting computer systems for virtual currency mining is not a money services business under the Bank Secrecy Act. FinCEN concluded the company does not function as a virtual currency administrator because it retains no access to mined currency or third-party wallets, nor does it accept or transmit funds on behalf of clients. Furthermore, the ruling states that providing rental services for mining hardware does not constitute money transmission, as the activity is exempt from regulation as a mere provider of network data access services.
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