- The EU wants to ban privacy coins and anonymous wallets by 2027 and have to collect and store crypto companies for all transfers.
- Transfers of over € 1,000 of self -hosted wallets must be verified, which leads to fears of dependence on decentralized channels.
The European Union has confirmed that as part of a new regulation, it will begin to pursue all crypto transfers as part of the anti-money laundering regulation. In his speech at the European summit to combat financial crime in 2025, the President of the Eurogroup, Pascal Donohoe, explained the change towards a stricter supervision.
The new regulations oblige the providers of crypto assets to record both the data of the sender and that of the recipient. This means a complete expansion of the traditional financial transparency regulations to the crypto sector.
Donohoe confirms the expansion of the AML supervision for cryptocurrency
During his fundamental speech in Dublin said Donohoe The EU intends to “record data on the senders and recipients of funds” as part of a wider advance for crypto transparency. According to Donohoe, the rules would apply directly to crypto-asset service providers (CASPS), which represents a step of regulation towards the integration of crypto into the existing AML structure of the EU.
The President of the Eurogroup emphasized that the application of AML laws to cryptocurrencies was essential and part of the efforts to go beyond the traditional forms of financial transfer. According to Donohoe, the complete transparency of crypto transactions is now a political priority. He also called the new one GWG authority (AMLA) A groundbreaking development that will improve cross -border cooperation.
Die GWG Ordinancewhich was adopted in 2023, forms the legal basis for this supervision. From July 1, 2027, it will be prohibited by the companies regulated in the EU to offer services related to anonymous wallets and privacy coins. Donohoe said these measures aim to contain illegal crypto activities and improve financial integrity within the block.
AMLR frame aims at privacy coins and self-hosted wallets
As from the European crypto initiative explainedthe AMLR law will prescribe the EU countries to grant agencies such as the Financial Intelligence Units and the GWG direct and immediate access to crypto account details. The law is prohibited from dealing with anonymous coins such as Monero and Zcash.
The Monero developer Riccardo Spagni said that this step is a “general ban” for data protection-friendly cryptocurrencies. He noted that the regulation prescribes “intrusive controls” for self -hosted wallets, especially for transactions that exceed 1,000 euros. Service providers must check the identity of users who transfer money from self -hosted wallets.
Spagni argued that these provisions violate Article 7 and 8 of the EU Charter, which guarantee the protection of privacy and data. He said that legal steps were likely to be afraid that the AMLR undermines the protection of digital privacy:
“What the regulations do is that law-abandatory Europeans are withheld from a digital cash equivalent.”
He also warned that the new law will drive crypto into illegality, with peer-to-peer trade and decentralized stock exchanges:
“We already see it with Binance and octopuses who take assets out of the trade long before 2027.”
Voices from the industry predict strong opposition to the plans
Critics say that the rules do not match the decentralized nature of the cryptocurrency. James Toledano, COO of Unity Wallet, said the regulation was like bank standards, but not compatible with decentralized systems. He said that “self-controlled cryptocurrencies are global” and that users can handle these restrictions through offshore channels or decentralized apps.
Toledano also warned that the new rules will push some activities into the darker, less transparent parts of the market. He is concerned about the effects on normal users and developers and says that the result will be a shrinking of the crypto economy in the EU.
Spagni predicted a “privacy-tech escape”, in which developers and wallet providers migrate to countries who respect privacy. However, he also said that the changes will accelerate the innovation in technologies to maintain privacy. He mentioned zero-knowledge-proofs, threshold signatures and L2-bridges as makeshift solutions to maintain anonymity without using fiat-on-ramps.
Since the anonymous use of cryptocurrencies will soon be banned across the EU, attention could be paid to more transparent assets such as Bitcoin. Since privacy coins are confronted with regulatory headwind, Bitcoins could encounter more interest in users and service providers.
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