European cryptocurrency industry steps up efforts to influence EU policy

More than 40 cryptocurrency business leaders have urged the European Union not to require cryptocurrency companies to disclose transaction details and to slow down attempts to scrutinize rapidly growing decentralized financial platforms.

In a letter seen by Reuters and sent to 27 EU finance ministers on April 13, cryptocurrency companies urged policymakers to ensure their regulations do not hit rules already in place under the FATF (Global Financial Action Task Force). ), which sets standards for combating money laundering.

European Union lawmakers last month approved support for new safeguards that involve tracking transactions made in bitcoin and other cryptocurrencies. The rules, contested by leading US digital currency exchange Coinbase, require cryptocurrency companies to collect and retain information about who is involved in digital currency transfers.

In response to last month’s vote, 46 European cryptocurrency industry leaders and organizations said in the letter that the proposals “put all digital asset owners at risk”, leading to the public disclosure of transaction details and wallet addresses. This will reduce the privacy and security of cryptocurrency holders, the authors of the letter said.

The bloc is also introducing a broader framework, known as the MiCA, to regulate all issuers and service providers in the European Union that handle cryptocurrency. The letter called for the exclusion of decentralized projects, which include decentralized finance, or “DeFi”, from the requirements to register as legal entities. In the document, the entities also claim that certain decentralized “stablecoins” should not be subject to the MiCA regulation.

CoinShares Chief Executive Jean-Marie Mognetti, who organized the letter, said that Europe currently has more complex cryptocurrency regulations than other regions, which has prevented companies in the sector from growing on the continent.