Cryptocurrencies are on the verge of losing their edge in European countries as members of the EU (European Union) are now looking into banning all anonymous crypto trades.
The European Union Is Working on New Crypto Regulations
The process is designed to ensure all monetary transactions are safe. The organization is seeking to end all financial crime such as money laundering and terrorist financing and representatives believe this will lead to a stronger environment for all traders. In addition, the European Union is looking to halt all crypto trades either equal to or higher than 10,000 euros.
The European Commission explained in a statement:
Given that virtual asset transfers are subject to similar money laundering and terrorist financing risks as wire fund transfers… It therefore appears logical to use the same legislative instrument to address these common issues.
On the one hand, regulation like this makes sense. Cryptocurrency – from the day it first appeared on the financial scene – has been subject to criminality such as theft, and without the appropriate rules in place, there is no chance that customers can ever be fully protected.
At the same time, the present suggestions would fully eliminate privacy, something that crypto has prided itself on for over ten years. Many traders and investors are looking to keep their identities hidden not necessarily because they are up to no good, but because they just don’t want prying eyes entering their business. It is the exact opposite of banks and standard financial institutions, which are often privy to all kinds of information when transactions take place such as where the money is from or how much.
With crypto, however, many users have more autonomy to them and are simply looking to keep their business to themselves. These new rules could potentially get in the way of that and violate one of the biggest factors of the crypto space.
The European Union is now looking to ensure that all cryptocurrencies are traceable so that they can track down any parties involved with malicious or illicit activity.
Will Other Governments Follow Suit?
The good news is that it could take as long as two years to implement these laws. The bad news is that other governments may follow in the European Union’s footsteps and implement additional barricades to anonymous trading, making the problem worldwide rather than just continental. Bob Seeman – a crypto author and tech entrepreneur – stated in an interview:
I believe that regulation will eventually overwhelm bitcoin. Some governments may soon realize that they already have gambling license requirements in place to regulate and collect tax due to every bitcoin transaction having any connection to the government’s jurisdiction.
Already traces of this behavior are being seen in other nations such as the United States, which is now working on implementing a plan that would fully regulate stable currencies in the future.