Proposed Update to Law in the USA Targets Travelers Who Use Crypto Currencies.

in bitcoin •  5 months ago

AML (anti-money laundering) Rules Target Over $10,000 Crypto Holdings

We all knew this was going to happen sooner or later but to actually see Senator Chuck Grassley sponsor a bill to update the old AML law is an eye opener.


In General.—Section 5312(a) of title 31, United States Code, is amended—

(1) in paragraph (2)(K)—

(A) by inserting “prepaid access devices, digital currency,” after “money orders,”; and

(B) by inserting before the semicolon at the end the following: “, or any digital exchanger or tumbler of digital currency”;

(2) in paragraph (3)(B), by inserting “prepaid access devices,” after “delivery,”; and

(3) by adding at the end the following:

“(7) ‘prepaid access device’ means an electronic device or vehicle, such as a card, plate, code, number, electronic serial number, mobile identification number, personal identification number, or other instrument, that provides a portal to funds or the value of funds that have been paid in advance and can be retrievable and transferable at some point in the future.”.

(b) GAO Report.—Not later than 18 months after the date of enactment of this Act, the Comptroller General of the United States shall submit to Congress a report on—

(1) the impact the amendments made by subsection (a) have had on law enforcement, the prepaid access industry, and consumers; and

(2) the implementation and enforcement of the final rule entitled “Bank Secrecy Act Regulations—Definitions and Other Regulations Relating to Prepaid Access” (76 Fed. Reg. 45403 (July 19, 2011)) by the Department of the Treasury.

(c) Customs And Border Protection Strategy For Prepaid Access Devices.—Not later than 18 months after the date of enactment of this Act, the Secretary of Homeland Security, in consultation with the Commissioner of U.S. Customs and Border Protection, shall submit to Congress a report—

(1) detailing a strategy to interdict and detect prepaid access devices, digital currencies, or other similar instruments, at border crossings and other ports of entry for the United States; and

(2) that includes an assessment of infrastructure needed to carry out the strategy detailed in paragraph (1).

Obama Talking About Encryption.

What Does This Rule Mean?

Well, I think it means that you need to report your Crypto Currency holdings when you enter the USA totalling more than $10k. It looks to me that you also need to report your devices that may have a Crypto Currency wallet on them. This includes pre-paid debit cards, mobile wallets, wallets on your computer, cold storage devices etc.

The update says that within 18 months they will give us a report that will outline the new rules. Right now everything that will be published will be opinions and best guesses.

Prepare Yourselves and Brace for Impact.

Don't Wait Until There is a Law, Start Preparing Now.

Steemit is a beast that cannot be tamed and I think we are going to the moon. This also means that we will have plenty of earnings on Steemit. I recommend you talk to a tax professional about how to handle the profits you earn on Steemit. Since the Steem blockchain is public and your holdings are available for the world to see it would be wise to declare them. This only applies to my fellow Americans. The rest of you need to contact a tax professional in your country.

Authors get paid when people like you upvote their post.
If you enjoyed what you read here, create your account today and start earning FREE STEEM!
Sort Order:  trending

The government will always find a way of leeching honest people ...

Draconian...And thanks for the Flashcoin @hilarski I forgot to thank you :)

None of this matters because someone can just store their private keys on the cloud.

Your masters have spoken. NOW OBEY, SLAVES!!!

I've always held the belief that the government will start to hunt down Bitcoin holders sooner or later. For this reason, I refuse to use exchanges or make any cryptocurrency transactions using my real name. I'll be sure to keep my laptop and cellphone clear of any Bitcoin or Steem related stuff in case they want to give me a digital cavity search.

Great post my cryptobrother! Thanks for sharing!

Not really surprised that govts will come knocking soon, trying to get their greedy hands on our crypto-pie.

This doesnt bother me too much at the moment however, as I've got at least a 5 year hodling instinct on all my coins.

Im hoping in 5 years, payment by crypto (be that Bitcoin or alts) for all sorts of things will be much more popular, and there will be less and less need to convert to fiat. Fiat is, after all, a poor proposition when compared to cryptos.

I'm also confident it will be easy enough to conceal crypto hodlings from govts in time. Just look at the great work that anon coins , especially Monero, are doing in obfuscating your information and creating true digital cash.

We ain't just gonna sit and watch this stupid laws exist, even if they do will have to come up with tons of solutions. Engraving inside the cover of our watches, chains, forming a fund transfer network whereby we can schedule our transfers. With that we can come in with less than the targeted amount and get our money when we are settled.

Using escrow services to transfer to ourselves.

Custom pocket Wallet (writing paper Wallets and then insert it into the pocket Wallet before sewing.

Custom key chains.

The thing is if criminals are exploiting you then you will have to come up with a counter attack.

Cryptocurrencies are like a fence to the Central Bank so they will want to disturb it by any means likewise the banks are exploiting us so we've standup

Is the TSA the ones who will be torturing travellers to make sure they aren't hiding an undeclared brain wallet? Or are the full body scanners already capable to detect thought crime?

These guys...

Taxation is theft. Of course, preaching to the choir here.

How would any of this be enforced without first complying and basically becoming more of a slave/bitch to the state?

Ways will be found to flow like water around the obstacles.

Trusted third party, escrow/landing wallets?

People getting significantly better with brain wallets?
(Lol yikes for some. Deflation anyone 😝?)

Better stealth on devices and keys 🔑? 😏

What else???

Will be cool to see how things develop...
We got this!

Solid post @hilarski !!!
We all needs to be situationally aware with these proposed measures.


Encrypted paper wallets - make your own simple encryption and save the key in your phone/laptop/cloud with a random name and location. When they check your paper wallet and it doesn't work, you tell them it's not a wallet code.


There are tiny cold wallets as well, I'm sure you can get creative with them when traveling.


The bill really shows how far behind these people are in figuring out what is going on. They obviously don't understand how private keys can be stored anywhere. Or how wallet seeds work.

A Swiss bank account in your pocket! Great term. Too bad the US Inc is so onerous that it's hard for Americans to even get a Swiss account these days.

"...we as a society decided that we're going to compromise a little bit of our freedom for a little bit of security..."
Anyone here recall being invited to the "we" party in this statement? I suspect it was a "they" party and "we" weren't actually invited.

Yet another reason to flee the land of the free. Thanks for the insights, Randy!

Things will get interesting these next few years in the crypto realm @hilarski. Also, thank you for your all your postings on bitcoin, as well as other cryptos. I appreciate you and your wife. I did finally do my introduction after contemplating content for so long. Sometimes a person can get stuck thinking too hard. =)

This is a bill, not a law yet. Most never make it to the books. We will see what happens. Communicating to your Representative or Senator would be a good idea if anyone opposes or supports the bill.


Yes, as was stated in the article but this one could be added to the books with barely a nod.


I hope not!

To the choir or to those who do not know. YOU can stop this intrusion!!

This is all about STATUS. Are YOU a Citizen or are you a man or woman? One is a Illusion (CITIZEN) the other the REALITY.

It is none of their business as to what you have. They have no lawful right to any of that information.

LEGAL is not the same as lawful. WE are living under a system of complete FRAUD.

We must come to this truth, a citizen, is a owned entity. STOP being a citizen. People must change their status to be able to live without the tyranny of the STATE, each of us must reclaim our birthright. TAKE BACK YOUR LIFE!!!

They have lied and kept US in the dark for centuries.

funny i just posted this earlier today.

We are the FORCE for CHANGE


Taxation is theft is a common belief amongst crypto-anarchists. Our wallets may be public but steem is a great way to do p2p transaccions and as far as I know neither the IRS Or any tax agency can confiscate our funds. Also travelling with crypto can easily be solved by having a third party send your funds after landing is one thought that comes to mind.

This is a stupid law. From its inception.

Any of the big movers of cash just use the banks.
It is fricken easy if you can afford a lawyer or two.

You move your cash to Cuba. Then you hire yourself or someone you want to give money to, to do something. (Do project X @ $1000/hour)
Or, give yourself a loan.

So, the law is meant to harass and terrorize little people.
And it will lead to confiscation of anything they say is inappropriate.

Things like: you have 1 bitcoin. Valued at $3,000 when you board the plane. And when you get there they say its worth $10,100 so, you just broke the law, confiscate everything and send you back.

Great idea, even longer waiting in line for processing waiting while border security checks all your devices, cards etc and demands keys and passwords. Way to go USA....Does anyone still really want to go there?

that's a concerning prospect - a bit invasive too - Good post - well written. Now following


He might do transfer on the spot to another person account or family account. then he's not in trouble, right?


That's correct

You are spot-on with your analysis as the global governments are currently working diligently behind the scenes to make cryptocurrencies with the same rules, regulations, and tax implications as fiat currencies. They will want to take a piece of the pie as they can't have money outside of what they can control in the hands of the "bad guys".

and if the carrier wasn't expecting to be carrying 10k because that's how crazy the crypto luck went? ;)

Gonna impact me since I live part time in Tokyo, part time in Cali. Will let everyone know if I have any problems.


For sure, you are a good example!


I hope not! Maybe I'll just keep 9,999 in the states and let my wife keep the rest in Japan.

Obama -"Everyone who has an encrypted device could be a pedophile terrorist with a Swiss bank account."
US Senate- " We must get our hands on all that Swiss pedo terroist money at once!"

Oh boy!
Whatever it takes, we gotta follow authorities.

But I'm searching for caves now, in case of emergency lol!

@hilarski do you anticipate by December IRS or governing bodies will have a protocol or system in place? Looks like legislation is starting to pile up already.


I don't think it will happen that quickly but they are working on it.

The banks will do everything in their power tho make sure they get a piece of the pie...The money always ends up by the bank. Crypto-currency I think is the way forward it more like barter system except with ideas!!

Thanks for the update! Always good to be aware when predators calling themselves “government” are plotting future attacks.

This also means that we will have plenty of earnings on Steemit. I recommend you talk to a tax professional about how to handle the profits you earn on Steemit. Since the Steem blockchain is public and your holdings are available for the world to see it would be wise to declare them. This only applies to my fellow Americans.

How are you doing this Randy?

  • Declaring Steem/SP as income based on the dollar value at the time it was transferred into your account?

  • Or declaring Steem converted to USD as income at the time of conversion?

I have absolutely no idea how I would go about figuring out the former, but I have been thinking a lot about this lately. I don't mind paying taxes and I definitely wish to do what is right, but I suspect HR Block isn't going to be of much help ;)

We should do lunch or coffee next time you are in the city. If interested hit me up on


My guess is that the tax professional would take the value based on the last day of the tax year but I may be wrong. So many issues come up especially once we powerdown or take our SBD off platform. For sure let's get together soon.

Let's see: cash at the bank is essentially "prepaid" and banking app on smartphone is a device that allows retrieval and transfer of funds at any time. This can get ridiculous real fast!

This is another regulation that is framed as being purposed to "protect citizens", but has many other implications and can/will be used as a tool for government to leverage their way into more and more of our personal lives.

Now a full force information war is on the rise by the looks of it... Thanks a bunch for all this information. I really hope the people involved will strengthen their knowledge of their rights, technology and, more importantly, stick together. Proper prior preparations will help in the prevention of aggravating circumstances...

All for one and one for all! Namaste :)

Actually the world of Cryptocurrencies will make trouble for all governments and banks. Especially for government that collect taxes so every one can hide his own money within an online currencies that is untraceable.

We are entering to a new century that every one has it's own right on his own money.

Well said! I am surprised no one wants to up-vote your comment.... They are all going crazy about ICOs...

Because of the existence of steemit this amounts to an endorsement of censorship if passed. Laws like this could result in a more invisible steemit like app becoming more popular. Except in freer countries. Sad!

This might sound weird, but I actually make little songs out of my 12 word passphrases in order to remember them. Its very effective. For example, my KeepKey Passphrase is sung to the Old Mcdonald had a farm tune, and is therefor called Old Mcdonald had a KeepKey, Trezor, Paper wallet, Exodus, etc. Point being, delete your wallets and just recover your wallets with your songs once you are done traveling. They do not come out of your head. Also this is a HUGE IF it gets to that point of invasion of privacy. A solution will be made immediately. Those old dinosaur lawmakers cannot possibly keep up with the pace that the technology is being developed. Its like trying to stop a sandstorm with chicken wire. They will eventually see the futility and stop wasting the money to try and stop it. Just my opinion.

OK so if travelling to the US, leave main crypto wallet at home.

When in US dial into your home VPN, then send coins to your mobile crypto wallet after you cross the border.

Sounds legal to me, no?


I think that and brain wallets are what people will do. People will always be one step ahead but we knew this was coming.


Im guessing if you carry a device that has a wallet.dat file on it though, they are gonna ask you to demonstrate it doesnt include $10K or more in it? Refuse that and I expect you will be refused entry.

So my suggestion is as you cross through customs have a minor amount there, then transfer in whatever you need later.

Pity Steemit doesn't have any privacy options, but I guess things would be pretty easy to trace in any case, considering that the votes have to be public. Living the perpetual traveler/prior taxpayer lifestyle may be an option for some, and hopefully many take advantage of it.


We were discussing this issue the other day. I wish they would implement something.

Well I knew this had to happen, think we all knew it but avoided the pink elephant in the room.
I'm actually in this with my brother in law so let's see how that works out.
I'm doing the research and he is throwing some money at it. We both see a future in this, we missed many boats ,so hopefully we can profit together in this!!!
Great post and thanks

Thanks Hilarski, I agree with your assessments. But there are some strategies to pursue.. 1) switch citizenship, 2) dual citizenship, 3) own e-currencies through a business entity. Always a solution for those willing to take the extra steps..

This will probably fly under the radar. It's also the first I've heard of it. Thanks for sharing Randy.


No problem Joan, it will be something we have to watch.

Thank You @hilarski for the news, we can't do anything about that but always better to know that what they are plotting and planing for our future.

Excellent piece of information @hilarski. Just finished a book called "Digital Gold: Bitcoin and the Inside Story of the Misfits and Millionaires Trying to Reinvent Money," by Nathaniel Popper. Your article is a perfect follow-up to the book and I highly recommend giving it a read if you are new to the Blockchain, Bitcoin, Cryptocurrency, or Steemit.

Check this out @quantumanomaly!

Very nice

very nice post

There's dark days coming to the US. =\


That's why a lot of use Americans are prepper.

Honestly it would surprise me if the Feds DIDN'T seek to sabotage cryptocurrencies. But they will fail, just like they will fail trying to sabotage the Internet, hackers, or leakers. Decentralization is the path forward.

Interesting post

a good work. I like yours

Don't Wait Until There is a Law, Start Preparing!

Great post...

The government can't get in? GOOD!

I guess the central bank are fighting back against crypto currencies, using their government stooges.


We have seen what they can do to our precious metals. Now let's see what they will try with Cryptos.


The central banks wont give up without a massive fight, they have everything to lose. I have been saying for years now, Crypto's are a marvelous invention, but never underestimate a cornered rat banker. Cheers, Great post.

@marcstevens is my tax professional, and he says make them prove that the existence of the law is proof that the law applies.

They can't do that without resorting to a logical fallacy, but good luck arguing that yourself in court, you havta practice well in advance to pull it off.
I have first hand personal knowledge of the efficacy of his method.
I have personally argued this method in court, myself, and walked out with no time or fines.

For everybody else, do what Randy has said, he has a level head,...

i guess the silver lining is that we knew. @steamant @oh-kay

We'll guess what, good luck trying to find us all. We need to get P2P and private deep web servers ASAP

I'm a little lost...would you pay tax only when you cashed your crypto into dollars or other currency? If not it would be a nightmare to track all the conversions through different altcoins and calculate the profits in regards to the initial investment.

The reason i'm asking is because in forex trading it doesn't matter if you withdraw the profits from your trading account or not, at the end of the fiscal year you have to report your overall profit/loss and you pay tax on that. In this case it's easy to keep track of all the transactions you made, your broker gives you a statement and is that simple.

I'm in UK and have no idea what legislation they have for cryptos here, but i'm sure they will want to tax it. Anyway like you said, on steemit your profits are public so to avoid any problems, when the time comes, i will declare my profits. I can't say that i enjoy giving them a cut, but hey, this is how our society works for the time being.

Is this really happening, looks like its time to save your passwords in your head. They are getting scared that they are loosing control of the financial system. Heads up.... they are! welcome to decentralization.

So you live in Panama now...Seems like you have already taken the appropriate action :)