The primary evidence is not the fundamental truth – It’s a very surprising report in favor of so-called “anonymous” cryptocurrencies that has just been released. Contrary to what one might have thought, these latter pose even less risk of money laundering than other cryptocurrencies. Explanations.
Anonymous cryptos may be compatible with regulations
The Perkins Coie law firm provides a surprising answer to the following question:
„Is it possible for regulated entities to comply with anti-money laundering (AML) obligations when accepting anonymous cryptocurrency?“ “
“Astonishing”, because the experts‘ answer is clear: yes!
In a report released on September 15, attorneys for Perkins Coie scrutinized several of these anonymous trading cryptocurrencies for regulatory compliance .
These are 4 cryptos that have passed on the grill, as well as an anonymization method :
the essential Crypto Nation Pro, unfortunately very popular with ransomware hackers ;
Grin (GRIN), based on the MimbleWimble protocol ;
Zcash (ZEC) and its optional anonymous transactions ( shield transaction );
Dash (DASH), a Bitcoin clone with anonymization options thanks to its private transactions ( private send );
the CoinJoin method , which consists of mixing (or “ mixing ”) transactions in bitcoins (BTC).
Bitcoin is more to watch than anonymous cryptos?
“Anonymous cryptocurrencies present an inherent risk to anti-money laundering that is lower than other cryptocurrencies, when looking at evidence of illicit use in practice. “
Aside from their quality of protecting the financial privacy of individuals and businesses, anonymous cryptos did not present any real problems in the regulatory framework defining virtual asset service providers (or VASPs).
Lawyers cite regulations such as those of the Department of Financial Services in New York (NYDFS), the Financial Services Agency in Japan (FSA), the Financial Conduct Authority (FCA) in the United Kingdom, or even and the International Financial Action Task Force (FATF). All would be compatible with anonymous cryptoassets.
Indeed, the level of customer identification (KYC) of regulated VASPs would mean that anonymous transactions between individuals or companies would not be a problem if they then pass on these platforms.
This type of crypto would therefore not require further regulation , which would be deemed “too restrictive” by these lawyers. They believe that the current regulations are a sufficient compromise between the prevention of money laundering and the development of innovative technologies , beneficial for preserving privacy.
It is therefore a real argument, argued, in favor of anonymous cryptos that the lawyers of Perkins Coie have led here. But from there to what is enough to calm the regulatory fever of the governmental authorities, it remains unfortunately very uncertain.