Top federal agencies in the United States are collaborating to revise the definition of “money” as part of a broader effort to tighten reporting requirements for financial institutions handling local and cross-border cryptocurrency transactions.
The U.S. Department of the Treasury revealed this regulatory initiative in its semiannual agenda issued on Aug. 16. The final notice of proposed rulemaking is expected to be issued in September 2025, pending regulatory clearance.
The agenda, which includes input from the Board of Governors of the Federal Reserve System (FRS) and the Financial Crimes Enforcement Network (FinCEN), outlines plans to amend the Bank Secrecy Act to encompass cryptocurrencies under its definition of “money.”
This move is intended to bring cryptocurrencies, often used as a medium of exchange but lacking legal tender status, under the same reporting rules as traditional fiat currencies.
According to the agenda, the proposed changes ensures that the revised rules will apply to transactions involving convertible virtual currencies, which either have equivalent value to currency or serve as a substitute.
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The proposal will also extend the reporting requirements to digital assets with legal tender status, including central bank digital currencies (CBDCs).
In related developments, the U.S. Department of Justice (DOJ) is also updating its regulations, specifically focusing on crimes involving artificial intelligence (AI).
On Aug. 7, the DOJ urged the U.S. Sentencing Commission to update its guidelines to impose additional penalties for crimes committed with the assistance of AI. These recommendations seek to apply to any crime facilitated by algorithms, expanding beyond current guidelines.
This regulatory tightening follows recent actions by the U.S. government, including the transfer of roughly 10,000 Bitcoin linked to a Silk Road raid.
Earlier in June, Consensys requested the U.S. Internal Revenue Service (IRS) to delay implementing proposed tax regulations that require brokers and exchanges to report certain cryptocurrency sales.
In a letter to the IRS, Consensys cited concerns about the burden these regulations would place on entities that do not traditionally have reporting obligations.
The IRS published an early version of Form 1099-DA in April, following tax reporting rules proposed last August. These rules would treat crypto brokers similarly to traditional brokers handling stocks and bonds, requiring them to file 1099-DA forms for specific crypto transactions. The draft form categorizes brokers as kiosk operators, digital asset payment processors, hosted wallet providers, unhosted wallet providers, and others.
Consensys, the developer behind the MetaMask wallet, criticized the draft form for its lack of clear instructions and overly broad definition of a broker, which could result in multiple parties reporting the same transaction.