Bitcoin Exchanges Worldwide Are To Reveal Their Customers | BTC-ECHO
A storm is brewing on the crypt sky. The International Financial Action Task Force (FATF) adopts its proposed guidelines to regulate Bitcoin and Co. on June 21. The regulations apply to all crypto companies. The news portal Bloomberg, which has this information, spoke with various representatives of the Bitcoin industry about the upcoming consequences. Many players seem to be seriously worried. Eric Turner, Research Director at Messari Crypto Research Center, even described the regulations as "one of the biggest threats to crypto today."
This is due first to the international character of the FATF. The organization's advisory board dedicated to the fight against money laundering and terrorist financing includes 38 states and two international organizations. In practice, however, more than 180 countries are following the guidelines issued by the FATF. Failure to do so would be equivalent to an exclusion from the international financial system. In addition to its almost global validity, however, it is above all one of the planned guidelines that makes the Bitcoin world eagerly listen.
Bitcoin exchanges need to collect information about the recipients of crypto payments
The said Regulatory Directive states that Bitcoin Exchanges and similar service providers collect information about all customers whose transactions exceed $ 1,000. Brisant: The FATF does not just ask for information about the initiator of the transaction. The stock exchanges also have to collect data about the recipient and forward them to the payment service providers of the recipient. What sounds simple could be very difficult in practice. The crux of the matter is the technicality of cryptocurrencies. After all, wallet addresses are anonymous, so stock exchanges can not know who is the recipient of a payment. John Roth, chief compliance and ethics officer at Bitcoin Bittrex, outlined to Bloomberg the only two possible scenarios:
Either a complete and fundamental restructuring of the blockchain technology will be required, or a global parallel system is needed, which, as it were, must be built among the approximately 200 stock exchanges in the world.
According to Bloomberg, some crypto exchanges are actually considering setting up such a system. This would probably entail increased compliance and thus increased transaction costs. In such a case, it would be conceivable that customers handle their Bitcoin transactions directly and without the stock exchanges. It remains questionable how quickly and with what rigor the regulations are implemented. The FATF could well give the industry a transitional period. However, the fact that an international regulatory framework is in place is certain. Only a few days ago, the G20 countries agreed on the need for a multilateral solution.
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