EU authorities approve ban on crypto payments from wallets without KYC

The new measures must go through additional stages of approval

25.03.2024 - 11:30

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What’s new? The European Parliament has approved new measures as part of a broad anti-money laundering legislative package that will also apply to cryptocurrencies. These include a ban on cash payments over 10 000 EUR, a ban on anonymous cash payments over 3000 EUR, and a ban on anonymous crypto payments by transferring funds to custodial wallets for any amount.

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What else is known? The new measures were approved by European Parliament officials on March 19, and are expected to undergo additional approval procedures and begin to apply three years after coming into force. They prohibit any transfers from unidentified non-custodial wallets to custodial wallets.

Member of the European Parliament Patrick Breyer, who voted against the new measures, said that banning anonymous payments would have minimal impact on crime, while depriving law-abiding citizens of financial freedom. He said the phasing out of cash increases the risks that banks will introduce negative interest rates or stop lending money altogether. “Dependence on banks is increasing at an alarming rate. This kind of financial disenfranchisement must be stopped,” the official said.

Source: Twitter.com

Circle’s (USDC issuer) Director of EU Strategy and Policy Patrick Hansen commented on the new measures, stating that non-custodial wallets and making payments using them are not prohibited. He explained that P2P transfers and software and hardware non-custodial wallets are not subject to regulation under the new comprehensive Anti-Money Laundering Regulation (AMLR) project.

“However, paying with crypto (for example to merchants) with a non KYC’d self custody wallet will be more difficult/banned depending on the merchants set up,” Hansen added.

Earlier, EU authorities approved the tightening of AML rules for crypto companies and also allowed a complete ban on anonymous crypto transactions.

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