The new EU Money Laundering Act (TFR) has loosened the restrictions on holding one's own cryptocurrency tokens.
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| Self-hosted wallet ban is currently off the table |
According to sources, the most recent version of the "Transfer of Money" Regulation does not include a restriction on self-hosted wallets (TFR). The EU law aims to put in place regulations to stop money laundering and terrorism funding in the cryptocurrency industry.
The former design would have allowed for the restriction of cryptocurrency users' ability to store their own coins and tokens in wallets. Outrage over this spread, especially among the DeFi community.
The amended version now makes it clear that it does not want to outright ban self-custody services. The directive is instead centered on identifying wallet owners.
A 1,000 euro transaction cap would consequently apply to wallets whose owners are unknown. Providers would then need to implement intricate procedures for capturing and verifying transaction data and sharing it with the relevant authorities.
It also has to be made clear how privacy blockchains and token mixing services are handled. The EU continues to threaten to outlaw these services, based on the existing situation.
Before the Parliament votes on the amendments on March 28th, the most recent version of the TFR is currently available for comment. However, more adjustments might be made during ongoing discussions between institutions, the European Parliament, and the European Commission.