If passed into legislation, the EU vote will require all exchanges to report crypto transactions above $1000 from “unhosted cryptocurrency wallets”. The requirement will oblige exchanges to collect personally identifiable information.
According to the Press Release on the subject by the European Parliament, the measure is part of a package to prevent money laundering, terrorist financing, and other crimes.
The vote was passed today by MEPs from the Committee on Economic and Monetary affairs (ECON), together with the Committee on Civil Liberties (LIBE), by 93 votes to 14, with 14 abstentions.
In order for the proposed law to be adopted it still needs to pass through tripartite meetings between the EU parliament, European Commission, and the European Council, but it’s not expected that these bodies will change the legislation in any major way.
Ernest Urtasun, co-rapporteur for ECON, said:
“Illicit flows in crypto-assets move largely undetected across Europe and the world, which makes them an ideal instrument for ensuring anonymity. As illustrated by all the recent money-laundering scandals, from the Panama Papers to the Pandora Papers, criminals thrive where rules allowing for confidentiality allow for secrecy and anonymity. With this proposal for a regulation, the EU will close this loophole.”
Assita Kanko, co-rapporteur for LIBE said the following:
“Our report has two goals: to protect and to normalise. We should be facilitating the use of crypto-assets by people of good will safely and correctly, as well as protecting against the use of crypto-assets for terrorist financing, extortion, child sexual abuse material or money laundering. But we also seek to normalise the crypto world as it grows, implementing rules that create trust. More than a decade after the creation of Bitcoin, it is high time we took these important steps for our citizens.”
There are those in the crypto industry who are very much against the proposed new EU legislation. Brian Armstrong, CEO of Coinbase, stated in a tweet that the proposal is “anti-innovation, anti-privacy, and anti-law enforcement,” and that cryptocurrency would be held to an unfair standard compared to fiat. He also remarked:
“Imagine if the EU required your bank to report you to the authorities every time you paid your rent merely because the transaction was over 1,000 euros,”
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.