For investors with anonymous crypto wallets, the European Union (EU) is saying no more. According to recent reports, the European Commission is looking at banning anonymous crypto wallets by 2024.
This announcement has sent cryptocurrencies tumbling. For example, Bitcoin (CCC:BTC-USD) just slid under the $30,000 barrier, trading at its lowest level in a month. Other cryptocurrencies have followed suit.
Whether cryptocurrencies will ultimately prevail following this regulation remains to be seen. However, other high-profile crypto bans recently have stoked the idea this was coming. China has increasingly come down heavy on domestic crypto-mining activities. And India’s proposed crypto ban has been another high-profile case of late that has sent cryptocurrencies on a downward trajectory.
Let’s take a closer look at what the EU is proposing and why this is a big deal for crypto investors.
EU Ban of Anonymous Crypto Wallets Part of Wider Crackdown
Today, various reports of the formal announcement of a broad crackdown on crypto by European regulators have provided more in the way of volatility for cryptocurrencies. Already a volatile asset class to begin with, downside momentum is building. Indeed, on the heels of an EU crackdown on crypto, this might be expected.
Today’s announcement calls for stricter regulation of anonymous cryptocurrency wallets and transactions. Given the fact that the vast majority of crypto transactions and wallets are anonymous, this could be a veiled attempt to completely regulate out crypto from Europe. Given the size of the European market for crypto, this announcement is a big deal.
The European Commission has provided for the ability for companies to facilitate transfers of Bitcoin and other cryptocurrencies, on the condition that personal data are collected along the way. The idea is to prevent the risk of money laundering and nefarious activities with crypto.
The EU isn’t the first jurisdiction to propose harsh restrictions or an outright ban. However, it’s a significant market in terms of size and importance to the global cryptocurrency marketplace.
What will ultimately come of this crackdown remains to be seen. However, crypto investors remain on their toes today amid spiking volatility.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.