Sunday, November 1, 2020

New EU Anti-Money Laundering Laws Force Shut Down of Cryptocurrency Firms

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A total of three cryptocurrency firms have announced they will be shutting down over the introduction of the AMLD5 European Union regulation that’s coming into effect on January 10, 2020.

As CryptoGlobe reported, the first firm to announce it was shutting down was Bottle Pay, which provided its users a service to send cryptocurrency via social media accounts. It will be shutting down after “seeing huge growth in user numbers over the last few months” and raising $2 million in a seed funding round.

Bottle Pay reportedly decided to shut down as the new regulations would “alter the current user experience radically, and so negatively” that to maintain their “integrity as service providers” and to protect its users, it decided to shut down.

Now, TheBlock reports two more firms, a cryptocurrency mining pool and a bitcoin gaming platform, are shutting down over the same regulations. The mining pool, Simplecoin, published a notice on its website revealing it will shut down not to implement know-your-customer (KYC) and anti-money laundering (AML) checks on its service, to protect users’ privacy.

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[su_quote]When the laws come into effect, we would be forced to require you, the users, to identify yourselves for anti money-laundering purposes. We have been searching for solutions for a while, but it has become apparent that there is no way around it. (…) Mining should to be available to anyone and we refuse to jeopardise our users’ privacy.[/su_quote]

Simplecoin’s co-founder, Christian Grieger, revealed the firm has 42,000 users and two employees. Its users have until December 20 to withdraw their funds and until December 31 to delete their account information.

The gaming platform, Chopcoin, is also co-founded by Grieger, is shutting down over the same regulation as it imposes stringent report obligations on the firm and would allow Financial Intelligence Units to obtain the addresses and entities of its users. Chopcoin had 305,000 users and two employees.

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