An industry expert, on Sunday, has ‘debunked’ claims that the European Union has banned anonymous crypto wallets and transactions.
On Saturday, reports spread across the industry, claiming that the EU’s recent anti-money laundering (AML) law specifically targets banning anonymous crypto accounts.
However, industry expert Patrick Hansen addressed these claims, clarifying that the law does not specifically target cryptos.
“Yesterday was a prime example of why crypto Twitter (and often crypto media) should not be trusted when it comes to crypto policy,” he wrote on X (Twitter).
1/ Yesterday was a prime example of why crypto Twitter (and often crypto media) should not be trusted when it comes to crypto policy. Let’s debunk claims that the EU is banning anonymous crypto transactions or self-custodial wallets.
Here is what’s actually in the EU Anti Money… pic.twitter.com/dsNZQzl9Mx
— Patrick Hansen (@paddi_hansen) March 24, 2024
“Let’s debunk claims that the EU is banning anonymous crypto transactions or self-custodial wallets.”
He stressed that the law “is not a crypto regulation,” but a broad framework that applies to all financial institutions. These includes CASPs (crypto-asset service providers), as well as services that are prone to AML risks such as gambling services.
“The AMLR will apply to all CASPs (exchanges, brokers etc.) that are regulated under MiCA,” Hansen wrote. “These CASPs will need to follow standard KYC/AML procedures like customer due diligence (CDD) etc.”
4/ The AMLR will apply to all CASPs (exchanges, brokers etc.) that are regulated under MiCA. These CASPs will need to follow standard KYC/AML procedures like customer due diligence (CDD) etc.
This is nothing new, as all crypto exchanges & custodial wallet providers in the EU are… pic.twitter.com/ZN1AsWdBpw
— Patrick Hansen (@paddi_hansen) March 24, 2024
Further, on contrary to the rumors regarding an outright ban on anonymous crypto wallets, the AML includes provision for them. According to Hansen, this rule is already included in the existing AML regulation where custodial wallets cannot provide services to anonymous users.
“Also, CASPs will not be allowed to provide accounts for privacy coins. This is already existing business practice across the world – not only in the EU.”
Additionally, the Markets in Crypto Assets (MiCA) regulation, already prohibits crypto listing with built-in anonymisation function. “As such, this is nothing new either,” he added.
EU’s AML Law Has Nothing New for Cryptos?
Hansen wrote that the regulation largely reaffirms existing AML rules for CASPs. The law poses an “extremely limited” impact on the crypto sector in the EU region, he noted.
Furthermore, the law has not introduced radically new restrictions on self-custody payments, wallets or peer-to-peer transfers.
“Therefore, you will be able to use your self-custody wallets for buying goods/services in the EU without any restrictions.”
The final text was agreed by the ECON committee in the EU in March and it only needs to pass final approval in the EU Parliament’s plenary and the EU Council.
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