The European Union (EU) recently introduced significant changes to its anti-money laundering (AML) legislation. As a result, it is now illegal to make cryptocurrency payments with unidentified self-managed wallets. This is part of a broader set of rules to tackle financial crimes within the continent. On March 19, the majority of the EU parliament’s leading committee voted in favor of this measure.

New rules for cash and crypto

Under the new AML rules, cash payments above €10,000 are now prohibited, with a lower limit of €3,000 for anonymous cash payments. There are also restrictions on cryptocurrency payments, mainly aimed at unidentified wallets managed by providers, such as those offered via mobile, desktop or browser applications.

These rules will come into effect three years after the laws come into force, although Irish law firm Dillon Eustace expects them to be introduced sooner.

Skepticism about the effectiveness of the law

Dr. Breyer is skeptical about the effectiveness of these laws in fighting crime. He argues that anonymous payments are a basic human right necessary for individual financial freedom. According to him, a general ban on anonymous payments would have little effect on crime, but would deprive innocent citizens of their financial freedom.

Breyer also warns of the negative economic and social consequences of such bans, such as the possibility of negative interest rates and increased dependence on banks.

Response to the new legislation

The EU’s stance towards cash and cryptocurrency payments has faced resistance in the past. In 2017, a public consultation by the Commission on limiting cash payments sparked a significant public outcry, with more than 90% of respondents speaking out against the measure.

They viewed anonymous cash payments as an essential personal freedom and questioned the effectiveness of payment restrictions in achieving their intended goals. Friedrich Schneider, an expert on the shadow economy, also believes that these measures will have only minimal effects on reducing crime.


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