EU Commission Proposes Central Database Record of Bitcoin Users

By July 26, 2016Bitcoin Business

The European Commission – the executive arm of the European Union – has proposed a directive aimed preventing the use the financial system for terrorist financing which includes a central database for bitcoin and virtual currency users’ identities and wallet addresses accessible to government financial intelligence units (FIUs).

The proposal seeks to require member states to bring into force the regulations necessary to comply with this directive by Jan. 1, 2017.

The updated anti-money laundering rules adopted May of 2015 marked an important step to improve the effectiveness of EU attempts to combat money laundering from criminal activities and to fight financing terrorist activities, the proposal noted.

The global financial system makes it easy to hide and move funds by creating layers of companies, crossing borders and hiding money streams. Terrorists and other criminals can cover their tracks. Sound Financial System Needed

The proposal seeks to address the gaps in the oversight of terrorist financial tactics, including the use of virtual currency, and at the same time avoid unneeded obstacles for law-abiding businesses. It noted the need to balance the need to improve security and the need to protect fundamental rights, including economic freedom and data protection.

On Feb. 2, 2016, the commission gave an action plan to strengthen the fight against terrorist financing, focusing on two main areas: 1) tracing terrorists through financial movement and preventing the movement of assets, and 2) disrupting the sources of revenue terrorist organizations use.

On Feb. 12, 2016, the EU’s Economic and Financial Affairs Ministers Council (ECOFIN) asked the commission to offer a proposal to amend the Fourth Money Laundering Directive (4AMLD) by the second quarter. On April 22, ECOFIN also sought action to improve the accessibility of beneficial ownership registers.

The European Parliament in May voted in a non-binding resolution to approve a proposal for a […]

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