Topic: EU wants to ban crypto anonymous transactions and wallets (Read 852 times)

I am not sure whether this is going to work out, and I am really not wishing that it works out because I am not going to like the idea of the government regulating cryptocurrency especially bitcoin. But in a situation, whereby this happens to be a success for them to carry it out, then we would all be left with no other option than to accept the regulation or we just have to forget about our assets, which I don’t think a lot of us would like to do.

snip

the media is one culprit why they have negative outlook towards crypto. they should dig deeper if they want true information on what's going on with this technology. because it is true, that up until now, fiat is still the leading currency when it comes to money laundering and other illegal activities.
if they will not change their outlook on this matter, they will be left behind by other countries when it comes to crypto-related businesses.

All under the guise of protecting against terrorism and fighting money laundering again. More likely, they'll just hit someone trying to make a living out of crypto, if they haven't already.

This is disappointing news since EU policies can affect systems even outside their borders. The question is, what do we do once these restrictions are in place?

They should realized that stuff that even cryptocurrency market is already progressing but still criminals do much still prefer on making use of fiat.It is just crypto do really took the blame which it had

been accused that criminality rate had risen up because of its existence which isn't still proven out but its safe to presume that because of decentralization plus having that anonymity then I couldn't really

blame on why people do really have that kind of impression.Government would be having always on the hunt on whatever possible transactions that they could trace on.

States will always strive to control cryptocurrencies as much as possible. Therefore, it will be a long-term confrontation between the people and the government. Of course, if funds in cryptocurrency are transferred through the exchange, then the states have the opportunity to control this process. However, they cannot control transactions between citizens. Yes, states justify such control by the need to combat money laundering and the financing of terrorism. However, an Interpol report in January showed that criminals use cryptocurrencies very little in committing crimes and that cash traditionally holds the primacy here.

This I believe may affect Bitcoin, at least as we know it so far:

"In particular, the EU would ban anonymous crypto asset wallets, according to an EU fact sheet, with the European Commission saying that systems like Bitcoin should be governed by the same rules as regular bank wire transfers."

In other words, for each transaction they want to identify the user who sends and the user who receives the transaction, which is easy if one of the parties is a registered exchange user. If the other party is not identified, the transaction is blocked.

I don't know how those who have their funds in hardware wallets and don't want to identify themselves would be. I suppose that at least they would be very limited in their ability to send funds. And then banning anonymous wallets is another blow to privacy.

I don't know what you think about how this could end up.

Legislators' goal to fight money laundering leads to more KYC burdens, which in turn makes any of the companies suffering from more KYC requirements an even more attractive goal to hackers. That in turn leads to more investment in security measures, that again hits the bottom line of those companies and rather leads to larger corporations who can afford security requirements financially, which again leads to further centralization of the industry... That are a lot of in turns, I know, but isn't that the way it will ultimately work out?

Obviously the majority want to comply with the law and that is the reason why there was mass-selloff in China. Even in India, when the bill on cryptocurrency was first proposed in 2018, a lot of the users sold their holdings. But here the users are more rebellious and a large section went vocal in social media. As a result of the campaign, the government relented and shelved the cryptocurrency bill. But the status of cryptocurrency in India is still in suspended animation. It is still not 100% legal. This creates issues while filing tax returns.

Some of that might be happening on an extremely small scale if anyone wants to risk prison time over holding bitcoin and having to transact under the radar forever.  The tradeoffs there seem way out of whack so I don't know how common that's gonna be, but I'd guess not at all.  What we know is much more common is people just selling out of bitcoin, which is why the price tanked below $30k.  There was a flood of people in China rushing to get out to comply with the law, which created a ton of new supply and crushed the price.

I'm in no way supporting this draft, but most people here in the thread got the news wrong (so far, mainly mu_enrico got it right). Before the thread degenerates entirely:

The EU is not planning to ban anonymous "transactions", but anonymous "centralized wallet services"!

The planned legislation is based on the FATF travel rule. It is directed to companies who control cryptocurrency on behalf of their users, i.e. exchanges, web wallets, brokerage services and so on, and some other companies (e.g. in the real estate business). Most of them in several EU states are already forced to do KYC, so in these countries there would be only minor policy changes. These would have to record the data of the transaction sender and receiver if they participate in one (i.e. a deposit on a centrally managed wallet, or a transaction to a real estate agent affected by the law). It's affecting entities that are already obliged to record these data when they receive bank wires or other fiat-based transactions.

So no, your Bitcoin Core, Electrum etc. are not affected.

This may however affect services like the providers of smartphone wallet software, maybe also blockchain.com or Blockstream's Green Wallet (although at least in the latter two cases I think they could rebrand the service as a kind of "backup service for keys" or so). In any case the keys have to be managed by a central entity.

I don't blame the thread participants, the Bloomberg article isn't "wrong" but pretty poorly written so it can be misinterpreted.

Anyway, I consider this planned legislation extremely harmful. It would place the KYC burden on more companies than now, also potentially on smaller companies; this would mean more targets to hacker attacks, and potentially more danger of identity theft. So the EU is trying to combat one type of crime (money laundering) making other, potentially more threatening types of crime (identity theft) easier.  

There is no need for any new "illegal" exchange. Here in India, less than half of the trading volume is nowadays done through the mainstream exchanges. Hostile government actions since 2018 has made many of the users move to P2P platforms and DEX exchanges. I guess this is the case with China as well. When the legal exchanges closed down, many of the users might have moved to P2P platforms (although doing this in a dictatorship like China is much more than doing the same in India).

An interesting question: If KYC is not possible for open source wallets like electrum, would they be banned in future from github? And in future you might need p2p software to download a bitcoin node, since they won't be allowed on any webserver that government can identify the owner and give them KYC responsibility

Maybe they hope for the countries or the EU to turn into an area where denunciation becomes a thing again. If I know somebody who owns Monero and I denigrate that somebody, I might even benefit from it in some way. Otherwise I don't get the point. The only way to catch every single thing that you as a state deem criminal is to give up freedom as a concept and turn your area into a full police state. Even then you will have criminals. The death penalty doesn't even keep freaks from raping and killing others.

In other words, for each transaction they want to identify the user who sends and the user who receives the transaction, which is easy if one of the parties is a registered exchange user. If the other party is not identified, the transaction is blocked.

I don't know how those who have their funds in hardware wallets and don't want to identify themselves would be. I suppose that at least they would be very limited in their ability to send funds. And then banning anonymous wallets is another blow to privacy.

I don't know what you think about how this could end up.

This I believe may affect Bitcoin, at least as we know it so far:

"In particular, the EU would ban anonymous crypto asset wallets, according to an EU fact sheet, with the European Commission saying that systems like Bitcoin should be governed by the same rules as regular bank wire transfers."

In other words, for each transaction they want to identify the user who sends and the user who receives the transaction, which is easy if one of the parties is a registered exchange user. If the other party is not identified, the transaction is blocked.

I don't know how those who have their funds in hardware wallets and don't want to identify themselves would be. I suppose that at least they would be very limited in their ability to send funds. And then banning anonymous wallets is another blow to privacy.

I don't know what you think about how this could end up.