FinCEN: DApps for Money Transmission are Subject to BSA

Decentralized Applications (DApps) now are subject to regulation that related to money transmission according to the new guidance released by the United States Financial Crimes Enforcement Network (FinCEN) on May 9.

The aim for this guidance is to help businesses subject to the Bank Secrecy Act (BSA) obligations to understand the regulation, as they use convertible virtual currencies (CVCs) for money transmission.

FinCEN gives an example of automated teller machines describing any DApps function as a money transmitter will be subject to the same regulatory framework as teller machines. As the FinCEN stated “Accordingly, when DApps perform money transmission, the definition of money transmitter will apply to the DApp, the owners/operators of the DApp, or both.”