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FAQ · CryptocurrencyQ-57946321 min read

Does using a smart contract instead of a bank account change the legal analysis?

The question in full

Learn why using a smart contract instead of a bank account does not change money transmitter licensing requirements under U.S. law.

Answer
The founder assumes that because the funds sit in code on a blockchain rather than in a company bank account, the traditional licensing rules do not apply.

No. The definition of a money transmitter is functional, not technological: accepting value from one person and transmitting it to another person or location "by any means." A smart contract is a means. FinCEN settled in 2013 that convertible virtual currency is "value that substitutes for currency," so moving crypto or stablecoins through a contract is the same regulated activity as moving dollars through a bank. (31 C.F.R. § 1010.100(ff)(5)(i)(A); FIN-2013-G001)

Faisal KhanAnswered 06/Aug/2026
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Page Last Updated: 06/Aug/2026 (5794632)