Members of the European Parliament are likely to vote to end the anonymity of even small crypto payments at a committee meeting to be held next week, documents seen by CoinDesk show.
Lawmakers at the Economic Affairs Committee are also poised to include crypto transfers to self-hosted or private wallets (also referred to as unhosted wallets) in anti-money laundering (AML) checks, and want to halt crypto transfers between the EU and jurisdictions like Turkey and Hong Kong.
Under existing laws, payees need to be identified for any bank transfer over EUR 1,000 ($1,099). The bloc’s national governments have already said they want to scrap that lower limit when extending the rules to crypto assets – on the basis that large transactions could just be broken up into smaller ones, a practice known as "smurfing."
Urged by national laundering officials, who cite crypto’s use in funding terrorism and child abuse, lawmakers seem set to agree to require identity checks for any size of crypto payment. Even the right-wing lawmakers who oppose the move to de-anonymize transactions appear to acknowledge they won’t win the vote.
Internal parliament documents seen by CoinDesk, dated March 25 suggest lawmakers will also tell crypto service providers to refrain from making or aiding any transfers deemed at high risk of money laundering or crime.
That will in practice make it harder, or perhaps impossible, to make transfers from the EU to anywhere deemed by the bloc as a tax haven, such as the U.S. and U.K. Virgin Islands, Turkey, Russia or Hong Kong, or places like Iran and the Cayman Islands seen as dirty-money hotspots.
Assita Kanko, one of the lead lawmakers responsible for marshalling the parliament’s views on the law, also said Tuesday she wants to extend the measures to include privately held crypto assets, in spite of uncertainty over how transactions between unhosted wallets could be enforced.