Hiding your identity while using virtual currencies like Bitcoin would be harder under a proposed European Commission directive to help prevent the use of digital currencies to finance criminal activities and terrorism.
The proposal would create a central database holding records of the identities and wallet addresses for users of all crypto-currencies including Bitcoin. The information would be accessible to member states’ financial and law enforcement officials “through a centralized automated search query”.
“This proposal seeks to prevent the large-scale concealment of funds that can hinder the effective fight against financial crime and to ensure enhanced corporate transparency so that true beneficial owners of companies or other legal arrangements cannot hide behind undisclosed identities,” the proposal says. “Unfettered access to information is essential to ensure that flows of money can be properly traced and illicit networks and flows detected at an early stage,” reads the proposal
If passed, the directive would require Bitcoin users in all of the EU’s member states to have their details registered although customers would be able to voluntarily provide their identity “as a sign of good faith”.
The draft legislation does not recognize crypto-currencies as actual money. The legislation could become law as early as January.
