A not so anonymous Bitcoin: the European Union proposes to trace the sender and receiver of each cryptocurrency transaction


In a new attempt to end money laundering and the use of cryptocurrencies for criminal actions, the European Union Commission has new proposals to implement. Among them is the request that all transactions can be traced to know their sender and receiver. Likewise, it is proposed to prohibit anonymous cryptocurrency wallets.

At the moment it is a series of proposals and not a law as such. A package of legislative proposals presented by the European Commission to apply in all EU member states. They seek to end “money laundering and financing of terrorism.” While there is already a legal framework for this, the European Commission wants it to extend further to virtual currencies and new technologies that allow a more global and anonymous flow of transactions.

Currently anti-money laundering laws do not cover the entire crypto sector. With these new laws it is sought to do so in full. For example, it would force cryptocurrency providers and exchanges to trace all transactions to know who is behind each of them.

On the other hand, one of the most interesting measures has to do with crypto wallets. According to the European Commission, the proposed new rules will prevent anonymous portfolios from being created to ensure the traceability of transactions.

Cryptocurrency platforms will have to offer the authorities essential information about each user. For example, it will be necessary to collect the full name, the official identity document or the physical address. Although currently some platforms already do so because they are obliged to do so, the new rules would include all cryptocurrency platforms that operate in the European Union.

Less crime … and less anonymous

Purpose of all this? To reduce money laundering and the financing of terrorism in the European Union. A strict control of the users who use digital cryptographic assets would allow to stop the criminal activities that include these currencies.

Now, there is a negative part to all this, it ends with one of the major premises of Bitcoin and its similar: its privacy and the possibility of being anonymous. Although the way in which Bitcoin is structured it is not possible to know who is behind the transactions, the EU can limit and regulate how platforms operate with customers. At the moment, in any case, it is only a series of proposals that must be voted on in the European Parliament.