EU wants to verify crypto payments
Cryptocurrencies have never been 100% anonymous in the sense as the concept of “anonymity” is usually understood: the deanonymization of any address in the blockchain is fundamentally possible.
On this page
Moreover, “KYC” verification, which implies not only deanonymization, but also personalization (for example, through the requirement to provide passport data) is also a common practice for any centralized exchange.
But the precedent that is possible in the European Union is something new. Members of the European Parliament decided that the state should be aware of each of the counterparties between which cryptocurrency transactions in the amount of 1,000 euros and more will be made.
In fact, we are talking about the prohibition of any anonymous payments. But it is important to understand that the new law is already not only a matter of anonymity and confidentiality, but also of privacy: no matter who you transfer funds to, and no matter what interface you use, it is now not only “your business”.
Another problem that lawmakers may not even be aware of is that users of non-custodial services are not necessarily “customers” in the usual sense. How the deputies, who could never use cryptocurrencies themselves, will bypass this incident is not yet entirely clear.
However, ECON and LIBE (the special committees of the European Parliament on economic and currency issues, and on civil liberties) voted in favor of proposals for the mandatory provision of information by cryptocurrency service providers about persons who have made transactions worth more than 1,000 euros.
The new requirements obviously cover all CEX, non-custodial and hardware wallets (such as MetaMask, Trust Wallet and others). The law is expected to be adopted after going through trilateral meetings between the EU Parliament, the European Commission and the European Council.
The situation with the adoption of such changes will not be unambiguous. For example, Coinbase CEO Brian Armstrong said the EU proposal looks “anti-innovation, anti-privacy, and anti-law.”
Also, in his opinion, this law creates different conditions for fiat and cryptocurrency transactions (although at first glance everything looks just the opposite – as an attempt to equalize the “rules of the game”)
Politicians, who are infinitely behind the new technologies, seem to have decided to catch up with progress by slowing it down. They are terrified of missing the moment when the world realizes that it no longer needs them.
The content on The Coinomist is for informational purposes only and should not be interpreted as financial advice. While we strive to provide accurate and up-to-date information, we do not guarantee the accuracy, completeness, or reliability of any content. Neither we accept liability for any errors or omissions in the information provided or for any financial losses incurred as a result of relying on this information. Actions based on this content are at your own risk. Always do your own research and consult a professional. See our Terms, Privacy Policy, and Disclaimers for more details.
Articles by this author
