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New EU Law Does NOT Ban Anonymous Crypto Transactions

New EU Law Does NOT Ban Anonymous Crypto Transactions


The EU has presented an expanded anti-money laundering law, which affected cryptocurrencies as well. However, despite the barrage of criticism, experts hastened to clarify everything: the EU is not going to ban anonymous cryptocurrency transactions and wallets.

The news that the European Parliament is allegedly going to ban anonymous cryptocurrency transactions and wallets as part of a new anti-money laundering law was shared by MP Patrick Breyer. 

On his X, he wrote that the new law imposes restrictions on cash transactions and anonymous cryptocurrency payments. The ban applies to anonymous crypto transactions via custodial wallets, anonymous cash payments over €3,000 and cash payments over €10,000. 

Breyer also criticized the new law. He said that the ability to make transactions anonymously is a fundamental right, adding that the ban would have no effect on crime but would deprive citizens of financial freedom. 

His statements immediately provoked mixed reactions. Some agreed with the need for a ban, while others were sure that the law could violate privacy and interfere with economic activity.

But as it turned out later, the EU is not going to ban anonymous cryptocurrency transactions and cryptocurrency wallets. Expert Patrick Hansen hastened to decipher what the new anti-money laundering law really means. 

For a better understanding, we suggest reading Patrick Hansen's full thread. 

First, the legislation that has been dubbed AMLR is not a new law that would regulate the crypto space one way or another. It is merely an expansion of the already existing AML law. 

Second, the AMLR legislation covers non-financial organizations such as FCs, gambling services, etc. While hardware or software cryptocurrency storage providers, such as Metamask or Ledger, do not fall under the expanded AMLR law. So there is no ban on their use. 

What does fall under the expanded AMLR law are the MiCA-regulated exchanges and brokers. However, this law is not new for them either, as they already comply with similar rules (AMLD5).

Other prohibitions specified in the extended AMLR law are already observed in Europe. Namely, it is about the prohibition of providing services to anonymous users by custodial crypto-businesses, as well as the prohibition of the use and listing of anonymous coins. 

The €10,000 limit does not apply if a user transfers funds from a wallet to an exchange, but if the amount exceeds €1,000, the exchange will require KYC. Buying goods and services using cryptocurrency wallets is also not prohibited. 

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The materials found on the Cryptonica website shall not be taken as individual investment recommendations. The financial instruments or operations mentioned therein may not align with your investment profile or objectives. We assume no responsibility for any missing facts or inaccurate information in the texts. Cryptocurrencies are financial assets with high risk and volatility. Therefore, it is crucial that you conduct your own research on financial instruments and make independent decisions. Before engaging in any actions related to cryptocurrency, you shall study, understand, and comply with the laws applicable in your region and country.

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