Privacy Coin Persecution

In a leaked draft of a bill targeting money laundering, it was revealed that the European Union (EU) may be considering a ban on privacy coins like Zcash and Monero.

• The draft obtained by CoinDesk read, “Credit institutions, financial institutions and crypto-asset service providers shall be prohibited from keeping …anonymity-enhancing coins.”
• This proposal was penned with the intention of avoiding risk originating from cryptocurrencies designed to avoid traceability, which spawned concerns about money laundering practices.
• The so-called Czech proposal has come in response to growing demand amongst EU countries. If accepted, it would mean that crypto asset providers would be required to verify users’ identities for even small transactions under 1,000 euros.
• Furthermore, large crypto transactions would be subject to “probing” to uncover their nature and purpose.
• The bill must receive endorsement from both the EU Council and the European Parliament to be passed into law.

Anti-Money Laundering Regulation was proposed in July last year as part of broader measures that would also “forbid large cash transactions and create a new anti-money laundering agency, AMLA, to vet practices at large financial institutions.”, according to CoinDesk.

Regulatory attention is often drawn from high-publicity bad acts, like what we are currently seeing storming across the industry with FTX and all of its associated fallout.