Europe To Regulate Cryptocurrency Transfers

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Europe To Regulate Cryptocurrency Transfers

Europe Paving Path to Regulating Crypto Transfers

Cryptocurrency is subject to regulation as the segment could risk the financial stability of a country. It can simultaneously be used for the purpose of crime. These factors, and a couple of more, have accelerated lately the work of policymakers across the world including the European Union.

The executive European Commission placed a proposal in 2021 that crypto exchanges and other crypto firms should submit information of users who are involved in the transfer of coins for easy identification as well as for reporting any suspicious transaction. The measure may even help the financial watchdog to discourage transactions of high risks and freeze digital assets, if required

It was proposed to apply the existing rule of transferring coins worth 1,000 euros or more. However, the rule was scrapped and this paves the path for the transfers to be in scope.

A low-value transfer may not be appropriate as users may thereafter create unlimited transfers and the transfers could be linked to crimes.

Meanwhile, the committee has voiced new provisions for individuals holding crypto wallets. The exchanges are excluded from the provisions.

Coinbase crypto exchange stated traditional cash has been a popular way of hiding financial crime and not cryptocurrencies.

While cryptocurrencies are banned in a couple of countries including China and many are working on the legal frameworks, two countries have adopted bitcoin, the first and most popular cryptocurrency, as their legal tender. El Salvador became the first country to announce it last year and recently the Central African Republic passed a bill for the same.

It is believed the measure would improve the financial condition of CAR, which is one of the poorest and least developed countries in the world.

Cuba, the island country that has been under the sanctions of the United States for decades, announced to legally adopt cryptocurrency apps for easy money transfer internationally at a cheaper transaction fee.

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