EU’s AML Bitcoin legislation needs tighter definition of ‘wallet provider’

EDCAB founder Sin Jones addressed the European parliament’s public hearing on virtual currencies earlier this year.
The much-awaited European Commission’s anti-money laundering legislation covering virtual currency may need to tighten its definition of “wallet providers” – as it stands, the wording means multisig key holders could be caught by the provisions.
According to the proposals, only those wallet providers offering custodial services “of credentials necessary to access virtual currencies“ are to be included in the legislation. However, there is no primary purpose limitation, meaning anyone who has responsibility for taking care of virtual currency keys for someone else will likely need to carry out due diligence, monitor transactions and report suspicious activity.
Sin Jones, founder, EDCAB, who spoke at the European parliament’s public hearing on virtual currencies earlier in the year, said the scope of the definition of wallet providers should be addressed.
Jones told IBTimes: “There are some issues around definitions and scope, about which we are making representations, and have already started that today actually.
“There are issues about what might end up being included as a custodial wallet provider. There is a definition and we believe that potentially it’s much wider than the term ‘wallet provider’; it could even include multisig key holders and so on, which could be problematic. So we need to tighten up perhaps on some of those things.”

This post was published at International Business Times on July 7, 2016.