• Compliance obligations and Monero Enthusiasts
• Justin Ehrenhofer on Anonymous Internet Money
• Honoring privacy regulation

Formally established regulatory bodies overlooking the activities of financial institutions are keen on regulating the cryptocurrency space as there is no reliable yardstick apart from the waxing and waning enthusiasm of investors.

For now, it looks like the sky is the limit in terms of growth potential for assets like BTC.  The rush to purchase crypto keeps boosting the asset price. The price momentum stays self-reinforced in terms of price momentum and speculation.  The price action drives the price even further.

Privacy coins like Monero (XMR) essentially combine the benefits that the traditional financial system and initial cryptocurrencies like Bitcoin offer. Naturally, therefore, compliance obligations always come under the scanner of Monero enthusiasts.

Justin Ehrenhofer recently expressed:  Is there an existing EU definition for “anonymous electronic money?” I’m waiting for people to throw Monero under the bus as a foil while claiming Bitcoin transfers from unknown counter parties aren’t “anonymous” because of blockchain analysis, which is stupid on many levels. Yay.

“Anonymous internet money” already existed in the EU regs on page 17, but I don’t see it defined. Instead, it’s reused in some of the new portions relevant to crypto.  So it’s ripe for misinterpretations and bad takes.”

Justin Ehrenhofer made these statements in response to:  “#17.  This regulation should also apply without prejudice to regulation (EU) 2016/679 of the European Parliament and the council.

Payment service providers and crypto asset service providers operate in multiple jurisdictions with branches or subsidiaries located outside the Union. Accordingly, they should not be prevented from transferring data about suspicious transactions within the same organization, provided that they apply adequate safeguards.  In addition, the crypto asset service providers of the originator and the beneficiary, the payment service providers of the payer and of the payee, and the intermediary payment service providers should have in place appropriate technical and organizational measures to protect personal data against accidental loss, alteration or unauthorized disclosure or access.

Trying to honor privacy regulation requires collecting personal data for compliance but not processing it further for commercial purpose! The fight against money laundering and terrorist financing is recognized as an important public interest ground by all member states. Therefore in compliance with this regulation, the transfer of personal data to a third country should be carried out in accordance with Chapter V of Regulation (EU) 2016/679.”

The interesting part is #18:  The persons that merely convert paper documents into electronic data and are acting under a contract with a payment service provider and persons that provide payment service providers solely with messaging or other support systems for transmitting funds or with clearing and settlement systems should not fall within the scope of regulations.

The full proposal is here:  https://ec.europa.eu/finance/docs/law/210720-proposal-funds-transfers_en.pdf