EU Proposes Regulations Requiring Cryptocurrency Wallets to be Non-Anonymous and Expanding Regulatory Scope of Service Providers
The European Union (EU) regulatory body, the European Commission (EC), has formally proposed stricter regulations on cryptocurrency-related businesses, aiming to ban anonymous cryptocurrency wallets by 2024.
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The European Commission (EC), the executive arm of the European Union (EU), has officially proposed stricter regulations on cryptocurrency-related entities, aiming to ban anonymous cryptocurrency wallets by 2024.
This news was initially reported in early July, and the latest announcement confirms the previous reports.
According to the proposal, companies involved in Bitcoin and other cryptocurrency transfers, known as CASPs, must obtain and retain personal information of both the originator and beneficiary of the transactions, as they believe it will assist law enforcement agencies in combating money laundering.
Furthermore, the EU has introduced new provisions to expand the scope of virtual asset service providers, including entities that are currently not under regulation.
In the fight against money laundering and counter-terrorism financing (AML/CFT), the European Commission stated in a press release: "To prevent money laundering or terrorism financing, preventive and detection measures will be allowed. Anonymous cryptocurrency wallets will be prohibited."
As per the European Commission's proposal, companies handling cryptocurrency transactions must record customers' names, addresses, dates of birth, account numbers, and recipient names. This contradicts the emphasis on privacy in the cryptocurrency space.
The rationale behind these regulatory measures, as explained in the proposal, is to "strike a balance between addressing these threats and complying with international standards without imposing excessive regulatory burdens on the cryptocurrency industry." The European Commission firmly believes that "these regulatory proposals will benefit the development of the EU's cryptocurrency industry as it will benefit from an updated, unified legal framework across the EU."
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