United States: federal money-transmission guidance and the state licences
There is no single federal licence for a crypto wallet in the United States. Three separate tracks apply, and a wallet product has to be run through each: the federal anti-money-laundering rules, which turn on whether the provider is a money transmitter; state money-transmission licences, granted state by state; and the securities and commodities rules, as far as the wallet or its features reach them. For stablecoins, the GENIUS Act adds a federal framework.
By Sergio Maldonado Elvira — Founder & Principal Attorney • CIPP/E · CIPP/US · CIPT · FIP
Law stated as of September 28, 2026. General information, not advice on any product.
Key Considerations
- →Hosted, unhosted and multi-signature wallets under FinCEN's 2019 guidance
- →Registration as a money services business and the duties it brings
- →Five state regimes, including California's DFAL from July 1, 2026
- →What is settled and what is not at the SEC and CFTC
The federal test: FinCEN's 2019 guidance
The controlling text for wallets is FinCEN's guidance FIN-2019-G001 of May 9, 2019, on business models involving convertible virtual currencies. It applies the regulatory definition of money transmission services: "the acceptance of currency, funds, or other value that substitutes for currency from one person and the transmission of currency, funds, or other value that substitutes for currency to another location or person by any means" (31 CFR 1010.100(ff)(5)(i)(A)). The definition excludes a person that only provides "the delivery, communication, or network access services used by a money transmitter to support money transmission services" (31 CFR 1010.100(ff)(5)(ii)(A)). For wallets, the guidance says the answer "depends on four criteria: (a) who owns the value; (b) where the value is stored; (c) whether the owner interacts directly with the payment system where the CVC runs; and, (d) whether the person acting as intermediary has total independent control over the value."
Hosted, unhosted and multi-signature wallets
"Hosted wallet providers are account-based money transmitters that receive, store, and transmit CVCs on behalf of their accountholders." For unhosted, single-signature wallets, the owner "interacts with the payment system directly and has total independent control over the value", and a person using such a wallet to buy goods or services on their own behalf is not a money transmitter. A multi-signature wallet provider that only adds a second authorization key to the owner's key "is not a money transmitter because it does not accept and transmit value"; if it combines that role with hosting, or "maintains total independent control of the value", it is. The guidance also separates anonymizing software, whose provider is not a money transmitter, from anonymizing services, whose provider is. On decentralised applications it says that "when DApps perform money transmission, the definition of money transmitter will apply to the DApp, the owners/operators of the DApp, or both." How genuinely decentralised deployments are treated at the edges remains unsettled.
What registration brings
A money transmitter is a money services business. It must register with FinCEN "on or before the end of the 180-day period beginning on the day following the date the business is established" (31 CFR 1022.380(b)(3)) and renew every two years. It must keep a written anti-money-laundering programme (31 CFR 1022.210) and file suspicious activity reports (31 CFR 1022.320). The travel rule applies to transmittals of funds of $3,000 or more (31 CFR 1010.410(f)), and FinCEN treats transmittals of convertible virtual currency as within it. There is no final federal rule placing special duties on transfers to or from self-hosted wallets: FinCEN proposed one in December 2020 (RIN 1506-AB47), and the federal regulatory agenda records it as withdrawn on April 12, 2024. OFAC sanctions apply to every wallet type, whether or not the provider is a money transmitter.
Sources31 CFR 1022.380·31 CFR 1010.410·RIN 1506-AB47·OFAC virtual currency guidance (2021)
The state licences
Money transmission is licensed separately in each state. Custodial wallets and exchanges generally need a licence in the states below; non-custodial software providers are generally outside, most explicitly in New York. California's Digital Financial Assets Law is the newest. According to the state regulator, from July 1, 2026 certain crypto companies serving Californians must hold a licence or have submitted a completed application; the date was moved from July 1, 2025 by AB 1934, signed on September 29, 2024, and the regulator's rulemaking (PRO 02-23) was still open on September 29, 2026. Several states have enacted the Money Transmission Modernization Act, a model law approved by the Conference of State Bank Supervisors on August 9, 2021; it is a template, and each state's enactment has to be checked. The table is a summary. Some statute texts were confirmed from regulator pages rather than read in full, and each citation should be confirmed before reliance.
| State | Instrument | Custodial wallet or exchange | Non-custodial software |
|---|---|---|---|
| New York | BitLicense, 23 NYCRR Part 200 (effective June 24, 2015) | Licence required (custody and exchange) | Outside: "The development and dissemination of software in and of itself does not constitute virtual currency business activity" (200.2(q)) |
| California | Digital Financial Assets Law, Financial Code Division 1.25 (AB 39, 2023) | Licence, or a completed application, required from July 1, 2026 | Purely non-custodial software is outside the control-based limbs; no categorical exemption from the regulator yet |
| Texas | Finance Code Chapter 152; Supervisory Memorandum 1037 (rev. January 28, 2025) | Only where the asset is "money or monetary value": sovereign-backed stablecoins yes, Bitcoin-type crypto no | Outside (no receipt of money or monetary value) |
| Florida | Florida Statutes Chapter 560; virtual currency added at 560.103 (effective January 1, 2023) | Licence required: transmitting virtual currency as an intermediary | Turns on the "intermediary" element; no express software carve-out |
| Washington | Uniform Money Services Act, RCW 19.230 | Licence required for transmitting or holding virtual currency for residents | Trigger is transmission for others; the regulator invites a case-by-case determination |
SourcesNY DFS·California DFPI, DFAL FAQ·Texas SM 1037·Fla. Stat. 560.103·Washington DFI·CSBS model law
Stablecoins: the GENIUS Act
The GENIUS Act (Public Law 119-27, approved July 18, 2025) creates the first federal framework for payment stablecoins. It makes it unlawful for anyone other than a permitted issuer to issue a payment stablecoin in the United States, and it carves out "any transaction by means of a software or hardware wallet that facilitates an individual's own custody of digital assets". It takes effect on the earlier of eighteen months after enactment (January 18, 2027) or 120 days after the regulators issue final implementing rules. As of September 28, 2026 its operative provisions are not yet in effect.
SourcesPublic Law 119-27
The SEC and the CFTC: settled and not settled
Settled: virtual currency is a commodity under the Commodity Exchange Act (7 U.S.C. 1a(9)); the CFTC has full jurisdiction over virtual-currency futures, options and swaps, and general anti-fraud and anti-manipulation authority over spot markets. Also settled: the SEC's Staff Accounting Bulletin No. 122, published January 23, 2025, rescinded SAB 121, which had required safeguarded crypto to be booked as a liability. Not settled: there is no comprehensive CFTC registration regime for spot platforms, and the line between crypto assets that are securities under the Howey test and those that are not has not been fixed by any final rule. The SEC issued an interpretive release on March 16, 2026 (File S7-2026-09) and proposed "Regulation Crypto Assets" on August 18, 2026 (File S7-2026-27); no final rule was listed on September 29, 2026. Our reading is that a purely non-custodial wallet provider that neither holds customer assets nor executes, matches or deals generally does not trigger broker-dealer, exchange or custody registration; that boundary is what the SEC is working on.
Tax reporting, briefly
Custodial digital-asset brokers report gross proceeds on Form 1099-DA for sales from January 1, 2025, and basis for covered transactions from January 1, 2026. The rule that would have treated certain decentralised front-ends as brokers was nullified by Public Law 119-5, signed April 10, 2025, so the reporting duty applies only to custodial brokers.
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