- The regulatory announcement appears to have had a substantial influence on Bitcoin’s (BTC) price, which has dropped 4.5 percent in the last 24 hours to $45,243 at the time of writing.
- The new rules must be passed through trialogue negotiations between the EU Parliament, European Council, and European Commission, and if they pass without opposition, the crypto business will have nine to 18 months to fully comply with the legislation.
- Ether (ETH) is down 3.7 percent to $3,282. Unstoppable Finance, European decentralized finance (DeFi) startup, expressed disappointment at the news but expressed hope that the suggestions will be rejected during future negotiations.
The crypto sector has reacted angrily to a European Union Parliament committee voting in favor of a regulatory package for non-hosted private wallets that includes stronger Know Your Customer (KYC) and Anti-Money Laundering (AML) rules. The proposed rules would compel crypto service providers, including exchanges, to authenticate the identity of everyone who interacts with them through an unhosted wallet, and any transaction worth more than 1,000 euros, or $1,100, would have to be reported to authorities.
Bitcoin’s (BTC) Price Has Dropped 4.5 Percent In The Last 24 Hours To $45,243
Coinbase CEO Brian Armstrong took to Twitter to express his displeasure with the decision, using parallels with fiat currency to illustrate the ridiculousness of reporting and validating a 1,000 euro transaction:
Consider what would happen if the EU mandated that your bank report you to the authorities every time you paid your rent because the transaction exceeded 1,000 euros. For example, if you sent money to your cousin to help with groceries, the EU required your bank to collect and verify personal information on your cousin before enabling you to transmit the money. On Thursday, the Economic and Monetary Affairs (ECON) and Committee on Civil Liberties, Justice, and Home Affairs (LIBE) voted to alter the Transfer of Funds Regulation.
The new rules must be passed through trialogue negotiations between the EU Parliament, European Council, and European Commission, and if they pass without opposition, the crypto business will have nine to 18 months to fully comply with the legislation. The chairman and CEO of digital wallet company Ledger, Pascal Gauthier, didn’t mince words either, declaring that the EU Parliament chose fear above freedom: A new regulation that sets the path for a huge surveillance system over Europe’s financial landscape has just been voted on.
The regulatory announcement appears to have had a substantial influence on Bitcoin’s (BTC) price, which has dropped 4.5 percent in the last 24 hours to $45,243 at the time of writing. Within the same time frame, Ether (ETH) is down 3.7 percent to $3,282. Unstoppable Finance, European decentralized finance (DeFi) startup, expressed disappointment at the news but expressed hope that the suggestions will be rejected during future negotiations.
Infeasible Wallet Verification Standards And Unreasonable Reporting Obligations For Crypto Enterprises
The revisions are a major setback for cryptocurrency in the EU and should be reversed in the trilogy, the firm said. Patrick Hansen, the head of the strategy and business development at Unstoppable Finance, also rushed to Twitter to express his displeasure with the measures, calling them a huge disappointment and a big threat to individual privacy. It includes infeasible wallet verification standards and unreasonable reporting obligations for crypto enterprises, both of which would be extremely harmful to EU citizens and businesses.
He observed that verifying an unhosted equivalent would be difficult, if not impossible, for crypto service providers, and warned that in order to remain compliant and avoid jeopardizing their legal position, some organizations may choose to stop processing transactions with non-hosted wallets entirely. Others, particularly smaller businesses, may find the possible operational expenses of compliance prohibitive, leaving compliance to the larger established firms, resulting in increased market consolidation. Hansen, on the other hand, expressed optimism that the rules could be weakened in the trialogue negotiations, citing certain Commission/Council members’ disapproval of the restrictions.
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Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.
Source: https://www.thecoinrepublic.com/2022/04/02/following-the-eu-voted-the-of-ban-unhosted-accounts-the-cryptocurrency-sector-retaliated/