Legislators in the European Union voted today in support of contentious legislation to make anonymous crypto transactions illegal, a move the sector has criticized as stifling innovation and invading privacy.
Despite opposition from big sector players such as Coinbase and legal experts, who warned that overly harsh privacy violations could face legal challenges in EU courts, the decision was passed on Thursday.
According to records obtained by CoinDesk, more than 90 lawmakers voted in favor of the idea.
The plans aim to expand anti-money laundering (AML) laws to the crypto sector, which now apply to traditional payments exceeding EUR 1,000 ($1,114). They also raise the bar for crypto payments, requiring the identification of payers and recipients of even the tiniest crypto transactions, including those involving unhosted or self-hosted wallets.
How will this affect Bitcoin users?
The measure criminalizes anonymous cryptocurrency payments. It includes transfers done through exchanges like Coinbase Global (ticker: COIN) and transfers made using self-hosted or private wallets like MetaMask, the most popular crypto wallet with over 30 million users.
According to Coinbase CEO Brian Armstrong, the exchange would be required to notify authorities if a customer purchased more than EUR 1,000 in bitcoin via a self-hosted wallet under the new regulation.
As the vote came through for making anonymous crypto transactions illegal Bitcoin’s price decreased around 2% in minutes, from $47,500 to $46,400.
