EU begins strict regulation of Bitcoin to combat terrorism

Rage Comment : Bitcoin's anonymity has led governments around the world to suspect that it is related to terrorist activities. Belgium, Germany and other countries have strengthened regulation of digital currencies after terrorist activities. However, digital currency experts have always believed that Bitcoin's traceability will deter terrorists, and its connection with terrorist activities is only speculation, without actual evidence. However, the EU still adopted an amendment to strictly control Bitcoin on July 4, and each member state must implement it within the year.

Translation: Annie_Xu

The European Union's executive arm recently adopted a new proposal to amend existing anti-money laundering (AML) laws to combat terrorist activities and money laundering.

The European Commission has proposed a series of changes, one of which is specifically aimed at preventing terrorists from misusing virtual currencies and other financial instruments such as prepaid cards.

Under the terms of the initiative, virtual currency exchanges and custodial wallet providers must comply with the EU’s Anti-Money Laundering Directive (AMLD). As such, they must take due diligence to “reduce the anonymity of such transactions.”

Frans Timmermans

The commission's first vice-chairman, Frans Timmermans, linked the initiatives to the international security situation.

"The new initiative will help government agencies track down those who hide their finances and carry out terrorist activities."

The European Commission also made a "parallel" recommendation aimed at preventing tax evasion techniques mentioned in the Panama Papers, a report earlier this year that listed ways to hide money in offshore accounts.

Other initiatives adopted are aimed at preventing tax evasion and money laundering, including lowering the ownership threshold for trusts, where the identities of the owners must be made public.

The main actions proposed by the amendment include increased protection for whistleblowers and information sharing between EU member states.

Shifting regulations in Europe

Due to concerns about user anonymity, the European Union began to significantly increase its regulation of virtual currencies this year.

After the Paris terrorist attacks last year, the European Parliament held a meeting in Brussels, Belgium in January this year to discuss whether to strengthen the monitoring of virtual currencies. A month later, the European Parliament proposed to set up a virtual currency task force to further study the technology.

After this initiative is adopted, other related initiatives will be submitted to the European Parliament for discussion and adoption.

Under the terms of the adopted virtual currency regulation, member states must implement the amendments and other anti-terrorist financing legislation by the end of the year.