The post The End of Anonymous Crypto Wallets appeared on BitcoinEthereumNews.com.

Key Takeaways: EU law will ban unhosted and anonymous wallets from July 1, 2027 All crypto‑asset service providers must enforce full KYC on every transaction. Self‑custodial wallets above €1,000 trigger enhanced due diligence. An estimated €60 billion annually flows through unhosted wallets in the EU today. What’s Changing in EU Crypto Regulations The European Union’s Sixth Anti‑Money Laundering Directive (6AMLD) and its companion Regulation lock in a sweeping ban on “unhosted” or anonymous wallets starting July 1, 2027. Under the new rules, every virtual asset service provider (VASP)—including exchanges, custodians, and certain DeFi bridges—must verify the identity of both sender and recipient for every transaction. Firms operating in six or more member states, or processing over €50 million per year, fall under the same umbrella. Any transfer between a hosted wallet (one managed by a regulated entity) and an unhosted wallet will be blocked unless the user completes a full Know‑Your‑Customer (KYC) check. Impact on Privacy and Decentralization By outlawing truly anonymous transfers, the EU directly challenges privacy‑centric currencies and self‑custodied holding models. While individuals retain the freedom to control their own private keys, they can no longer convert or spend those assets through regulated on‑ramps without revealing their identity. This puts pressure on privacy coins such as Monero and Zcash, which lack public audit trails. Decentralized exchanges (DEXs) that wish to interface with regulated gateways must integrate KYC walls or face geo‑blocking. Critics argue this undermines the ethos of permissionless blockchains, but proponents say it closes loopholes used for money laundering and illicit finance. Preparing for the 2027 Transition Across Europe, compliance teams are racing to shore up KYC/AML infrastructure. Major exchanges and wallet providers are: Implementing real‑time on‑chain analytics to flag transfers linked to undeclared self‑custody. Rolling out tiered onboarding where any transfer over €1,000 sparks enhanced identity and source‑of‑fund checks. Embedding KYC flows…

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Filed under: News - @ May 6, 2025 5:22 pm