In recent remarks, FinCen Director Kenneth A. Blanco reiterated that the agency’s rules apply to all transactions involving money transmission—including the acceptance and transmission of value that substitutes for currency, which includes virtual currency. He said that businesses that provide “anonymizing services” which seek to conceal the source of the transmission of virtual currency, are money transmitters when they accept and transmit convertible virtual currency and are therefore subject to Bank Secrecy Act and anti-money laundering regulations. “To comply with these obligations, virtual currency money transmitters are required to (1) register with FinCEN as a money services business, (2) develop, implement, and maintain an AML program …” and (3) establish recordkeeping, and reporting measures, including filing Suspicious Activity Reports (SARs) and Currency Transaction Reports (CTRs),” Blanco said. He cautioned that financial institutions adopting emerging financial technologies should assess and understand whether new financial products and services may be vulnerable to exploitation for financial crime; and whether this financial service activity has AML/CFT obligations under FinCEN’s regulations. He noted that the agency will continue to update its guidance relating to emerging technology. Meanwhile, Bloomberg reports that hedge funds that invest in Bitcoin may be facing some tax uncertainties because the IRS’s rules around cryptocurrency remain unclear.