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HomeBusinessDifficulties for non-custodial wallets may increase in EU

Difficulties for non-custodial wallets may increase in EU

This could lead to increased surveillance of exchanges like Coinbase and vulnerable to self-hosted wallets. These wallets are created by individual customers to safeguard their digital assets and investments
The European Parliament, one of the three statutory units of the European Union (EU), is expected to vote on a revised anti-money laundering law this week. This will make it mandatory for crypto exchanges to provide anonymous transaction details of their customers. Voting is likely to take place on a number of amendments to the EU’s existing transfer of funds regulation. These include reporting every crypto transfer over EUR 1,000 from an unhosted wallet to the relevant authorities.

Unhosted wallets such as MetaMask are digital wallets that are not covered by the Financial Action Task Force (FATF) or its definition of a Licensed Virtual Asset Provider (VASP). this law Another provision in the U.S. requires financial institutions to provide details of the payer and the payee, whether the payee is a customer of a particular VASP or not. 

Those in the crypto industry have strongly condemned these amendments. These could lead to increased surveillance of exchanges like Coinbase and vulnerable to self-hosted wallets. These wallets are created by individual customers to keep their digital assets and investments secure. If the EU Parliament approves these regulations, most crypto firms will not be able to transact with unhosted wallets. Coinbase’s Chief Legal Officer Paul Grewal said that these changes are based on false facts and that regulators see crypto as an instrument of criminal activity.

“These amendments will place the onus on exchanges to collect and verify details as well as report on customers who are not customers of the exchange and are using self-hosted wallets,” he said. Coinbase recently said it would make it mandatory for its customers in countries such as Singapore and Japan to provide transfer information when sending crypto to another exchange. This will include the name and address of the recipient. Due to the rise in crypto scams in recent months, regulations for crypto exchanges are being tightened in many countries. Many people trading in crypto have suffered huge losses from these scams.

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