Goodbye privacy: the EU will create a database of users of bitcoin

The EU can create a database of Bitcoin users to track their identity and addresses of the wallets. Therefore, the European Union plans to fight the funding of terrorism and money laundering.

Bitcoin controversial asset from the point of view of governments. Previously, the cryptocurrency has been accused that it is a means of financing criminal activities on the black market. In addition, the relatively high level of anonymity makes the authorities to worry that it is being used to Finance terrorism and money laundering.

These negative associations have stimulated attempts to regulate cryptocurrencies from the European Union. Probably, not the last role was played by the phenomenal growth of the prices and popularity of cryptocurrency, this year.

Kriptonyte market reached a record level at $ 600 billion, and bitcoin is more than half that amount. The most famous digital currency had an impressive year, which is accompanied not only by sharp jumps of the prices, but also its wider dissemination, in particular with the launch of futures
bitcoin.

Database

From proposition it follows that every cryptocurrency exchange must operate in accordance with the strict rules by reporting any suspicious activities and will have to follow the rules of identification of users.

According to The Telegraph, a new addition to the Fourth Directive against money-laundering States that the EU has the ability to create a «Central database, registered users’ identities and addresses of the wallets».

The proposal will be considered no earlier than 2019, when it will be discussed the effectiveness of the new rules to combat money laundering. Information about these databases will be available to authorized agencies such as National Agency for the fight against crime and agencies involved in asset recovery.

For bitcoin no more to hide?

These databases will completely break the veil of secrecy that surrounds bitcoin. It’s good for regulators, but not for users. Despite the fact that their user information may be confidential, their transactions in the blockchain are not.

In addition to cryptocurrency exchanges, regulators also monitor the ICO in an attempt to locate any instances of fraud or kiberprestupniki. The U.S. internal revenue service (IRS), in turn, tries to discover
those who shy away from paying taxes on profits made from trading digital currencies. It is engaged in and tax controller of India.

The irony is that a huge increase in the popularity of bitcoin can be a deterrent to cybercriminals, as the network is under high pressure, which leads to delays in transaction processing and high commissions.

Exchanges can accept

Experts believe that cryptocurrency exchanges will agree with the new regulations and will continue its work. Jacek Czarnecki (Jacek drew Mego), a lawyer specializing in digital currencies in the Polish law firm Wardynski & Partners, said:

«The new regulatory framework can bring order in a rather chaotic world of cryptocurrencies and improve the relationship between the world of the blockchain and the traditional financial systems.»

Impact of these plans on the popularity of the cryptocurrency and its price, it is difficult to say. In any case, the new rules will not come into force within the EU in the next couple of years, and in that time the cryptocurrency environment and the world economy as a whole may undergo a big change.

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