The U.S. Treasury Division advised Congress that bitcoin or crypto mixers can serve respectable monetary privateness functions, signaling a shift within the authorities’s strategy to blockchain privateness instruments.
The 32-page report, submitted beneath the GENIUS Act, additionally proposes new legislative instruments to fight illicit finance, together with a “maintain regulation” that might give monetary establishments non permanent protected harbor to freeze suspicious digital property.
The report acknowledges that lawful customers might make use of mixers to guard delicate data on private wealth, enterprise funds, or charitable donations.
This represents a recalibration from Treasury’s earlier stance, which included sanctioning Twister Money in 2022 and designating worldwide mixers as money-laundering hubs in 2023.
On the identical time, Treasury knowledge reveals that prison actors, notably these linked to North Korea, proceed to use mixers.
The report cites DPRK-affiliated cybercriminals who stole a minimum of $2.8 billion in digital property between January 2024 and September 2025, together with a $1.5 billion hack of the Bybit trade.
In these operations, mixers are generally used to interrupt tracing hyperlinks, usually together with stablecoin swaps and cross-chain bridges.
New knowledge on crypto laundering
The report supplies authentic Treasury evaluation of blending exercise involving stablecoins and bridges.
Since Could 2020, greater than $37.4 billion in withdrawals from over 50 bridges had been denominated within the two largest stablecoins by market capitalization. Of that whole, roughly $1.6 billion flowed from mixing providers, with over $900 million concentrated in a single bridge scrutinized for DPRK-linked exercise.
The Treasury famous within the report that direct stablecoin deposits into crypto mixers for illicit functions are comparatively low, however criminals regularly convert different digital property by means of mixers earlier than swapping into stablecoins to obscure the supply.
The report distinguishes between custodial and non-custodial crypto mixers. Custodial providers, which should register with FinCEN as cash providers companies, can present identification knowledge, off-chain transaction data, and behavioral patterns.
The Treasury doesn’t advocate new restrictions on non-custodial mixers and refrains from finalizing FinCEN’s 2023 proposed recordkeeping rule, as a substitute citing a 2025 Presidential Working Group report recommending cautious analysis of privateness and illicit finance dangers.
‘Maintain regulation’ to crack down on illicit exercise
Treasury additionally urged Congress to enact a digital asset–particular “maintain regulation,” creating a short lived protected harbor for freezing suspicious property throughout transient investigations.
The division described such a regulation as notably helpful for countering illicit finance involving permitted stablecoins.
On decentralized finance, the report recommends Congress specify which actors ought to face anti-money laundering (AML) and countering the financing of terrorism (CFT) obligations based mostly on their roles and related dangers.
It additionally proposes increasing Part 311 of the USA PATRIOT Act to authorize the Treasury to impose circumstances on sure digital asset transfers that fall exterior correspondent banking relationships.
These proposals align with issues raised by trade teams, together with Galaxy Analysis, which in January warned that the Senate Banking Committee’s CLARITY Act may signify the most important enlargement of economic surveillance authority because the Patriot Act.
The report comes at considerably of an inflection level for crypto regulation.
Treasury lifted Twister Money sanctions in March 2025 after a federal appeals courtroom discovered OFAC had exceeded its authority, although a Manhattan jury later convicted co-founder Roman Storm of working an unlicensed cash transmitter.
The Division of Justice has indicated a narrower strategy to prosecuting builders, suggesting that coding privateness instruments with out prison intent mustn’t represent a violation.
The U.S. Treasury framed the report inside a broader effort to check “revolutionary or novel” instruments for detecting illicit exercise in crypto, as mandated by the 2025 GENIUS Act.
The report attracts on greater than 220 public feedback and consultations with monetary establishments, blockchain analytics corporations, crypto corporations, regulation enforcement, and up to date nationwide danger assessments.