Europe: Should a total ban on cryptocurrencies be considered?
Cryptocurrency monitoring is becoming increasingly advanced. Although some countries have historically been interested in studying cryptocurrencies, cryptos have never been studied as closely as they are today. This is closely linked to the growth of the cryptocurrency market and although the latter is going through a difficult period, monitoring has not stopped but has grown even much more.
This time, Europe said it was considering banning transactions for cryptocurrency wallets that remain anonymous. When there are no more anonymous wallets, the number of illegal activities using cryptocurrencies will decrease significantly as transactions can be more easily traced and linked to an individual.
This is probably one of the most important regulatory measures that the European Commission intends to take. So far, their intention is to regulate the cryptocurrency market through legislation to prevent illegal activities such as money laundering and terrorist financing from being carried out using cryptocurrencies.
As indicated by the European Commission, this limitation is taken into account for every service provider trading cryptocurrencies. Many cryptocurrency exchanges or similar providers allow their users to hold wallets and conduct transactions without providing other identifying information, but that could end.
It is expected that any user with a cryptocurrency wallet will need to provide service providers with a set of credentials. This could reduce illegal activities but also increase market safety standards. This would increase investment opportunities.
It should be noted that there is a lot of fear when we talk about regulations because we understand regulations as prohibitions and although this has happened in the past it does not seem to be the case in Europe. So far there has been no talk of a total ban on the use of cryptocurrencies, which could actually be a good thing.
Is a Chinese model ban possible?
It wouldn’t be the first time a region decided to ban cryptocurrencies outright. This is what China has been doing over the past year, prompting many regulators to take a closer look at cryptocurrencies.
It is currently unknown what regulatory action Europe will take next, but what we do know is that there are many more regulations to come that could favor or discourage the use of cryptocurrencies and investors. Apparently Europe’s stance is not very restrictive, but that could change if the economy is to be more protected.