The end of the anonymity: UK authorities plan to regulate bitcoin

Bitcoin could be dealing with some issues in the UK. It has been revealed that both UK and other EU governments are thinking about ways to regulate bitcoin in an attempt to prevent the cryptocurrency from being used for money laundering and tax evasion.

The UK Treasury allegedly revealed plans to regulate cryptocurrencies in order for them to be compliant with anti-money laundering and counter-terrorism financial legislation. This means that traders could be forced to disclose their identities, which could subsequently mean the end of the anonymity which has made bitcoin popular, but also prone to illegal activities.

Online platforms could report suspicious transactions

The alleged plan is that online trading platforms would be forced to implement due diligence and report suspicious transactions as soon as they are traced. To be able to implement such a request, the UK authorities are reportedly working on adding some amendments to their anti-money-laundering directive and ensure that relevant authorities supervise the transactions.

The UK Treasury stated that it is working on this plan, which will most likely be ready to come into effect in a matter of a few months:

“We are working to address concerns about the use of cryptocurrencies by negotiating to bring virtual currency exchange platforms and some wallet providers within anti-money laundering and counter-terrorist financing regulation. There is little current evidence of them being used to launder money, though this risk is expected to grow.”

Banks react to bitcoin

This is not the first time when cryptocurrencies are associated with the potential of illegal activities. Goldman Sachs and JP Morgan previously stated that bitcoin could become a vehicle to commit fraud, among other illegal acts. However, not everyone agrees with this. For instance, the deputy governor of the Bank of England said that bitcoin was too small to be a serious threat.

Apparently, UK members of parliament will look into all cryptocurrencies to determine the impact and the risk associated to the rise of cryptocurrencies and exchanges. The new rules will most likely be applied at European Union level and are expected to be implemented sometime in early 2018. Discussions about regulation for cryptocurrencies were first revealed in October by the economic secretary of the Treasury.