A wave of unrest and another wave: the new EU proposal will "crack down" non-custodial encrypted wallets

This article comes fromDecrypt, original author: Scott Chipolina

Odaily Translator | Nian Yin Si Tang

This article comes from

, original author: Scott Chipolina

Odaily Translator | Nian Yin Si TangThe European Union is considering a regulatory approach that would crack down on “non-custodial wallets” of cryptocurrencies, wallets that are not held by third-party intermediaries.Popular non-custodial wallets include MetaMask, WalletConnect, or hardware wallets like Ledger and Trezor.

European Commission submitted

a text

“In the event of a transfer of crypto-assets from or to a crypto-asset wallet held by a non-third party (so-called 'uncustodial wallets'), the crypto-asset service provider or other obliged entity shall receive from its client (whether the originator or payee) to obtain and retain the required originator and payee information,” the proposed EU Commission text states. Under current law, any bank transfer over 1,000 euros (about $1,099) requires identification of the recipient.expressFurthermore, if the service provider comes to the attention that the information provided is inaccurate, incomplete or questionable, it should assess on a "risk-sensitive basis" whether to refuse or suspend the transaction, and whether to report the transaction to the relevant financial intelligence unit.

Since the proposal began to circulate, the crypto industry has expressed strong displeasure. Coinbase Chief Policy Officer Faryar Shirzad on Twitter

express

, “The latest draft could seriously infringe on personal financial freedom, cause irreparable harm to the crypto-economy, and stifle the future of innovation across the EU.”

"If you want to kill privacy, that's the best way to do it," he told Decrypt, "It's unlikely to be tenable over time, but over 15 years, a lot of damage will still be done. "

The European Parliament will vote on the wording of the proposal on Thursday, March 31, 2022.

secondary titleshow"PoW ban" storm

At the end of February, EU lawmakers were preparing for inter-agency discussions on proposed regulations governing crypto assets and potentially banning energy-intensive cryptocurrencies such as bitcoin. a draftshow, the soon-to-be-discussed Market in Cryptoassets (MiCA) regulatory package includes a provision that could limit the use of PoW consensus mechanisms across the 27 EU member states.However, due to strong opposition from the industry and other considerations, earlier this month, EU lawmakersagree

Remove all possible mentions of PoW mining bans in the MiCA regulatory scheme. Note, however, that one version of the new draft contains something like

terms, but has been significantly weakened compared to the original terms. It said that crypto-assets “should adhere to minimum standards of environmental sustainability with respect to the consensus mechanisms they use to verify transactions before they are issued, made available or allowed to be traded in the EU.”According to this clause, if the PoW mechanism works on a small scale, it does not need to meet the sustainability criteria. What counts as a small run is yet to be determined. It also said that energy-intensive crypto assets already in use across the EU will have to "establish and maintain a phased rollout plan to ensure compliance with the requirements set out in another part of the framework" before the legislation comes into force.

On 14 March, the Economic and Monetary Affairs Committee of the European Parliamentformal vote noA previous version of the scheme, which included a "de facto" ban on PoW cryptocurrency mining, was removed.

On March 25, the MiCA regulatory scheme begins

move on to the next stage of the discussion