According to a report published by Finbold, it has been claimed that the European Union (EU) has banned the use of anonymous self-custody cryptocurrency wallets for cryptocurrency payments of any size.
Patrick Hansen, Strategy and Policy Director of stablecoin company Circle, explained that self-storage wallets are not banned under the new law.
Payments to and from self-custody wallets are also not prohibited, and practices such as peer-to-peer (P2P) transfers, self-custody software and hardware wallets are expressly excluded from the Anti-Money Laundering Regulation (AMLR), according to Hansen.
However, Hansen noted that, for example, paying merchants with crypto from a self-custodial wallet that is not subject to KYC will be more difficult or prohibited, depending on the merchant's system. According to Hansen, this change and lower thresholds for anonymous cash payments were unfortunately already adopted months ago.
Journalist Vini Barbosa, who first reported on the ban, also published an update. According to Barbosa, the legislation would ban anonymous crypto payments, which they describe as “hosted wallets.” However, there is no consensus on what this provision actually means for anonymous payments from self-storage wallets to self-storage wallets.
Some believe these payments will inevitably be banned along with other already approved laws. Others think it won't be banned.
*This is not investment advice.