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EU to tighten regulations on bitcoin transfers

Kitco News

(Kitco News) In its latest anti-money-laundering campaign, the European Union is proposing to make crypto transfers, including bitcoin, more traceable.

The EU regulators want to see crypto transfers be subject to the same anti-money-laundering rules as wire transfers. Anonymous cryptocurrency wallets will also be banned under the new regulation.

"Given that virtual assets transfers are subject to similar money-laundering and terrorist-financing risks as wire funds transfers... it therefore appears logical to use the same legislative instrument to address these common issues," the Commission wrote. "In addition, providing anonymous crypto-asset wallets will be prohibited, just as anonymous bank accounts are already prohibited by EU AML/CFT rules."

The new rules would extend to the entire crypto sector. "All service providers [will be obliged] to conduct due diligence on their customers," the Commission explained.

This means getting the clients' name, address, date of birth, account number, and the name of the recipient.

"Today's amendments will ensure full traceability of crypto-asset transfers, such as Bitcoin, and will allow for prevention and detection of their possible use for money laundering or terrorism financing," the proposal said.

Before becoming law, the new regulations would need to get approval from member states and the European Parliament, which could take two years.

The U.S. is also stepping up its regulatory oversight over the crypto space. On Monday, U.S. Treasury Secretary Janet Yellen called for a quick establishment of a regulatory framework for stablecoins following a meeting with the nation's top regulators.

"The Secretary underscored the need to act quickly to ensure there is an appropriate U.S. regulatory framework in place," the U.S. Department of the Treasury said in a press release. "The PWG [President's Working Group on Financial Markets] expects to issue recommendations in the coming months."

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