EU Cracks Down on Crypto; No More Anonymous Transactions?

Due to the "anonymous" nature of cryptocurrencies, they are often associated with fraud, money laundering and other financial crimes. It is possible to trace virtual money transfers, but the full details of the initiator and recipient in the transaction chain usually remain unknown. To prevent this, the European Commission plans to ban anonymous transfers and cryptocurrency wallets.

The EC proposed measures this week to protect EU citizens and its financial system by introducing anti-money laundering and anti-terrorist financing rules. The proposed package includes four elements:

• The creation of a new EU authority for battling money laundering and terrorist financing;
• Implementation of new rules affecting the areas of beneficial ownership and due diligence;
• Updating the existing 2015/849/EU directive on the prevention of the use of the financial system for money laundering or terrorist financing with new provisions on national supervisory authorities and entity financial intelligence;
• Amending of the 2015 regulation on information accompanying funds transfers to track cryptocurrency transactions.

Here's the slogan on the graphic posted by EU Commissioner Mairead McGuinness on her twitter account.

Most of these proposals are aimed directly at large companies, but some of them could also affect the ordinary people who hold cryptocurrency assets. Under the European Commission's new proposal, service providers will be required to record customer information. This will ensure that all transfers are fully traceable from source to recipient, preventing "their possible use for money laundering or terrorist financing."

Mairead McGuinness, acting EU Commissioner for Financial Services, wrote on the matter on her Twitter account:

If the proposal is approved, cryptocurrency service providers handling asset transfers or traditional bank transfers will have to provide full details of the payer - including address, date and place of birth, and even personal document numbers.

Before the idea becomes law, it must be approved by the European Parliament and member states. It is not known when the vote on this will take place, as it is expected that the process could take up to 2 years.