Tuesday, October 20, 2020

Bitcoin Startup Bottle Pay Closes Over New EU Anti-Money Laundering Laws


The bitcoin payments startup Bottle Pay shut down on Friday, citing the AMLD5 European Union regulation coming into effect Jan. 10, 2020.

The Bottle Pay app once allowed users to send tiny amounts of bitcoin using just social media texts and handles, from Twitter to Telegram. There are roughly 974 members in the project’s Telegram group.

The London-based company raised $2 million in September, The Block reported at the time. Back in December, the team declined to name any of the investors but said the startup already served 10,000 user accounts.

Bottle Pay finally released a public beta with real bitcoin in late November, and just now realized new European regulations would dramatically alter the company’s roadmap.

- Advertisement -

“The amount and type of extra personal information we would be required to collect from our users would alter the current user experience so radically, and so negatively, that we are not willing to force this onto our community,” the company said in a statement, adding the team never charged for this service, added routing fees or sold anything to users.

First of many?

Bottle Pay won’t be the only British crypto startup impacted by the regulations, which require a strict user verification process. Similarly, the exchange Bitpanda announced on Friday it will roll out a new user registration process. Jon Matonis, chief economist at Canada’s Cypherpunk Holdings Inc., tweeted this policy applies to custodial crypto wallets.

The privacy-focused wallet Samourai Wallet, which isn’t publicly registered in any specific jurisdiction, tweeted earlier this year the team believes this policy also applies to noncustodial wallets (though they said they would not comply with it).

Teana Baker-Taylor, a London-based compliance expert and director of crypto industry group Global Digital Finance, said this policy could force all crypto wallet providers in the European Union to collect know-your-customer information from users.

- Advertisement -

In reference to cryptocurrency exchanges and custodial wallets, she said they will become “obliged entities,” similar to banks and other brokerage service providers.

“AMLD5 prohibits facilitated (non peer-to-peer) anonymous transactions,” Baker-Taylor told CoinDesk. “Custodian wallet providers and exchanges will be obligated to implement customer due diligence (including KYC) and transaction monitoring. They will also be required to maintain comprehensive records and report suspicious transactions.”

Speaking broadly in June to the need for more regulation in the global cryptocurrency industry, Steven Maijoor of the European Securities and Markets Authority (ESMA) said it’s “important to have risk warnings [and] risk information for consumers going into those products” – including anti-money-laundering procedures and arrangements.

When asked how specifically that policy should apply Maijoor said deferred to the expertise of the European Banking Authority.

In the meantime, Bottle Pay tweeted that all users should withdraw their funds within the next two weeks.


Ex-managers of Security firm pleads guilty in Santa Clara County concealed gun permit bribery scandal

Two former managers of a Silicon Valley international security firm pleaded guilty Monday to charges related to a bribery scheme to obtain concealed firearms...

Ohio former House Speaker Larry Householder to stand for reelection amid bribery charges

Republican Rep. Larry Householder’s name will be on the ballot Election Day as the disgraced Ohio lawmaker intends to serve his district for another...

Billionaire Robert Smith to Pay $140 million after admitting to tax evasion

Billionaire Robert Smith will pay about $140 million and acknowledge wrongdoing to end a four-year U.S. tax investigation involving assets held in offshore tax...

Mexico’s ex-army chief arrested in US on charges of drug trafficking, money laundering

Former Mexican Defense Secretary Gen. Salvador Cienfuegos, who led the country’s armed forces for six years under then-President Enrique Peña Nieto, has been arrested...

Texas billionaire Robert Brockman charged in $2 billion tax evasion case

Robert Brockman, the Houston billionaire and CEO of a software company, has been charged with taking $2 billion through a scheme to evade taxes,...

Latest News

This Week

Billionaire Robert Smith to Pay $140 million after admitting to tax evasion

Billionaire Robert Smith will pay about $140 million and acknowledge wrongdoing to end a four-year U.S. tax investigation involving assets held in offshore tax...

Chess grandmaster banned for cheating in competition

A disgraced chess grandmaster, banned from tournaments after he was caught cheating by using a phone while sitting on a toilet, has been seen...

Medical device maker Merit Medical agrees to pay $18m to settle false claims

Medical device maker Merit Medical Systems Inc. (MMSI), of South Jordan, Utah, has agreed to pay $18 million to resolve allegations that the company...

U.S appeal court upholds conviction of former Senator Jon Woods in bribery case

The 8th Circuit Court of Appeals upheld the conviction of former Republican Sen. Jon Woods for a bribery and kickback scheme. That decision also upheld the...

Adblock Detected!

Our website is made possible by displaying online advertisements to our visitors. Please consider supporting us by whitelisting our website.

Enable Notifications    Ok No thanks