The European anti-terrorist crisis broke out, and the EU's new anti-money laundering regulations hurt Bitcoin companies, but the development of blockchain was not affected

In the context of recent terrorist attacks across Europe and a document leak, the European Commission has proposed a proposal to amend the current Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations. The proposal requires amendments to EU Directive 2015/849 and Directive 2009/101/EC, both of which are related to the prevention of money laundering or terrorist financing.

The proposal includes a series of measures to prevent terrorist financing by exploiting existing legal loopholes. It also aims to increase transparency in financial transactions involving individuals and corporate entities. According to the proposal, the list of activities that carry a risk of terrorist financing includes cash transactions, cultural and artefacts transactions, virtual currencies like Bitcoin and other digital currencies, and anonymous prepaid cards.

The European Commission has made this proposal after consulting various stakeholders in the EU economy. Before making this proposal to revise the anti-money laundering regulations, EU member states, representatives of the European Parliament, representatives of the traditional payment services sector, digital currency exchanges, wallet service companies, representatives of the digital currency community, stakeholders in the banking and financial sector, financial intelligence units, Europol, the European Data Protection Supervisory Authority and various consumer organizations were all taken into consideration by the Commission.

Bitcoin companies will suffer losses

According to the proposed amendments, the new laws will bring cryptocurrency exchanges and wallet services under the scope of new AML and KYC regulations. In the near future, these laws may be further strengthened to force individual cryptocurrency users to "voluntarily" identify themselves. These regulations may also affect various Bitcoin platforms that offer prepaid cards, as they will also be covered by the new amendments.

The proposal shows that the Commission wants to ensure that foolproof AML and KYC regulations apply to every country without having to make any drastic changes to existing regulations already in place. The proposal labels Bitcoin exchanges and wallet services as obliged entities, forcing them to implement all required AML and KYC regulations. These digital currency platforms will be required to report any suspicious transactions to the relevant government entities.

Blockchain technology is not affected in the slightest

While the proposal is bad news for Bitcoin, companies researching blockchain technology can breathe a sigh of relief as it recognizes the importance of blockchain technology to businesses and government entities. It also reiterates that the current proposal will not have any negative impact on the research and development of distributed ledger technology.

Since the Paris attacks, some EU member states have been calling for stricter digital currency policies. This amendment to the anti-money laundering and terrorist financing regulations is not unexpected. However, its implementation has an impact on the Bitcoin industry that can still be observed.