European Commission anti-money laundering amendments may threaten one of Bitcoin's top attractions
One of the main player attractions of the cyber-currency Bitcoin is probably the anonymity of transactions in which it used, but that could become a thing of the past according to an article in Gaming Tech Law this week.
The piece points to a European Commission-sponsored anti-money laundering initiative calling for the creation of a centralised database of users in order to remove the danger of criminal abuse.
Apparently the 4th European anti-money laundering directive identified the dangers of anonymity as the main issue preventing the growth of virtual currencies.
The EC has therefore proposed that:
* Anti-money laundering regulations are extended to providers of virtual currency exchange platforms and wallet providers of custodial services of credentials necessary to access to virtual currencies which shall be licensed or registered;
* Financial Intelligence Units (FIUs) should be able to link virtual currency addresses to the relevant owner. For this purpose, a report on the implementation of the Directive shall consider also proposals on the possibility to set up of a central database of virtual currency/bitcoin users accessible to FIUs and allow virtual currency users to self-declare on a voluntary basis.
The EC recommendation must still be approved by the European Parliament, but could be implemented as early as January next year, Gaming Tech Law notes, commenting that the initiative indicates an attempt by European regulators to "control" virtual currencies using a definition based on function ie:
"A digital representation of value that is neither issued by a central bank or a public authority, nor necessarily attached to a fiat currency, but is accepted by natural or legal persons as a means of payment and can be transferred, stored or traded electronically".
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