Europe has always been a peculiar region when it comes to cryptocurrencies. More specifically, it seems there is very little interest in such currencies right now across the continent’s exchanges. That situation may come to change thanks to the new regulation handed down by the European Parliament’s Committee on Economic and Monetary Affairs. This directive is set to go into effect over the next 18 months across all member states.
Europe may Finally Warm up to Cryptocurrencies
Any form of regulation associated with cryptocurrencies is often considered a negative thing. That isn’t necessarily true, though, as the recent EU directive indicates things could finally change for the better. Although it is an official form of regulation, it is not necessarily something most users will be negatively affected by. After all, it doesn’t change anything for users who have already verified their identities when registering on cryptocurrency exchanges throughout the continent.
More specifically, the new directive forces both cryptocurrency exchanges and wallet providers to identify their users. Considering how most major exchanges started doing this years ago, it is doubtful anything will change for the average user. It is possible some companies will have to step up their game in this regard, but that shouldn’t be much of a problem. It is the first time wallet providers will need to adhere to such rules, though, as they weren’t subject to such requirements in the past.
Unlike what some people might assume, a cryptocurrency wallet is not the same as an exchange. There are quite a few online exchanges which can also be used as wallets, but that is not always the case. There are dedicated web wallets out there, although users often give up full control over their money when using those services. Considering that such companies usually act as custodians over users’ money, it is only normal they will need to adhere to the new rules.
EU Justice Commissioner Vera Jourova commented as follows:
Today’s agreement will bring more transparency to improve the prevention of money laundering and to cut off terrorist financing. Criminal activity has often been associated with Bitcoin, and it is of the utmost importance we prevent this type of activity before the money is effectively laundered through service providers.
How all of this will play out for cryptocurrency in Europe remains to be seen. Although there are a fair few crypto brokers throughout the continent, it seems most major exchanges dealing with EUR trading pairs see far less trading volume than one would expect. This new directive may help boost those numbers a bit, although it is doubtful any big impact will be felt in the next twelve months.
For now, there is still no plan on the table to actually prohibit or control cryptocurrencies. Nor would the EU or any other governing body be able to do so, as there is no centralized entity associated with cryptocurrency protocols to take control of. It seems this new directive is mainly designed to allow cryptocurrencies to thrive throughout all of Europe in the coming years. It is an interesting turn of events; that much is evident.