EU To Rein In Bitcoin, Change Prepaid Rules

Regulation over bitcoin, digital currencies and prepaid cards might soon get a little tighter in the European Union as new proposals from the European Commission would expand anti-money laundering rules.

This is a large effort to target major issues often associated with these payment types: terrorist financing and tax evasion. The proposals are also being created in order to determine how much oversight the EU needs on bank accounts in order to not only have better control on this issue but to increase transparency between how banks report suspicious activity.

Under the new rules , the EU would lower the nonreloadable prepaid card threshold to $167 (€150) from $276 (€250). This rule proposal comes less than a year after the attacks in Paris where the terrorists involved use prepaid cards.

Beyond prepaid, bitcoin and other digital currencies would be included in the EU’s anti-money laundering regulation that will be enacted at the end of 2016. What these rules require is that digital currency platforms must monitor transactions and users the same way banks do.

“Today’s proposals will help national authorities to track down people who hide their finances in order to commit crimes such as terrorism,’’ European Commission Vice President Frans Timmermans told The Wall Street Journal. “Member states will be able to get and share vital information about who really owns companies or trusts, who is dealing in online currencies and who is using prepaid cards.’’

Under the proposals for the new rules, they would also require member states to create a central register of information for all bank and payment account users in order for authorities to better access them in case they are linked to suspicious activity. Before these proposals could go through, however, they would have to be voted upon and agreed to by the bloc’s governments and the European Parliament.