Two committees of the parliament of the European Union voted for a bill that would strip all privacy protections from cryptocurrency.
It was reported by sources close to the issue that the bill “would ban transactions that state authorities can’t readily tie to a person or an organization.”
“Under the new requirements agreed by MEPs, all transfers of crypto-assets will have to include information on the source of the asset and its beneficiary, information that is to be made available to the competent authorities,” the European Parliament’s statement read. The bill did not include person-to-person transactions.
Opponents say that this legislation could open the door for “Debanking”. Debanking denotes a situation in which a large financial institution withdraws banking services to a business for any number of reasons. The company or organization could cancel a transaction or account if the asset source or beneficiary had personal beliefs the company disagreed with.
While the committees argued the legislation would help deter criminal transactions, the insistence on “traceability” concerned to privacy advocates and companies in the cryptocurrency industry.
“Among the worst of the proposed provisions are new obligations on exchanges to collect, verify and report information on non-customers using self-hosted wallets,” Paul Grewal, Coinbase’s Chief Legal Officer, wrote.
The company asked users to speak out against the legislation.
“If you care about protecting the privacy of individuals, and focusing the law on solutions that actually address legitimate concerns about the illicit use of digital assets, now is the time to speak up and be heard. We must speak with one, strong voice against this proposal before it’s too late.”
Other financial institutions have been willing to “debank” accounts based on the personal beliefs of the customer.
Last year, Chase Bank sent an account cancellation letter to Retired General Michael Flynn, a man who was notably an enthusiastic defender of former President Donald Trump. The letter said that doing business with the Flynn household was a “reputational risk to Chase.” The bank later claimed it “made an error” when it sent the cancellation letter.
