4AMLDBitcoinFintech Virtual currencies & the 4th Anti-money Laundering Directive: ECB Opinion on the Commission’s proposals Cooley The European Commission published proposals to amend the 4th Anti-money Laundering Directive, to bring crypto-currency exchanges and wallet providers within scope, in early July 2016.The European Banking Authority criticized those proposals in August, and the UK Treasury’s response of September suggests that it was also unimpressed.But the European Central Bank has responded more positively.In particular, it: “strongly supports” the Commission’s proposal to make exchanges and wallet providers “obliged entities” for anti-money laundering purposes; urges the EU’s legislative bodies to “take care not to appear to promote the use of privately established digital currencies“; stresses that “the euro is the single currency of the Union’s economic and monetary union“; only makes 2 substantive recommendations: “virtual currencies [should be defined] more specifically, in a manner that explicitly clarifies that virtual currencies are not legal currencies or money...”, they’re “a means of exchange“, not “a means of payment“.

The ECB therefore recommends that “virtual currencies” are defined as “a digital representation of value that is neither issued by a central bank or a public authority, nor attached to a legally established currency, which does not possess the legal status of currency or money, but is accepted by natural or legal persons, as a means of exchange and possibly also for other purposes, which can be transferred, stored or traded electronically“; and the words: “The credibility of virtual currencies will not rise if they are used for criminal purposes.In this context, anonymity will become more a hindrance than an asset for virtual currencies taking up [sic] and their potential benefits to spread [sic].The inclusion of virtual currency exchange platforms and custodian wallet providers will not entirely address the issue of anonymity attached to virtual currency transactions, as a large part of the virtual currency environment will remain anonymous because users can also transact without exchange platforms or custodian wallet providers” should be deleted from recital (7) to the Commission’s proposed Directive, amending the 4th Anti-money Laundering Directive, presumably because they may appear to promote the use of private digital currencies.

The ECB’s Opinion was prepared at the request of the European Parliament and Council.They are still to respond.While the use of bitcoin and blockchain technology picks up speed across the Atlantic, Romania is playing it safe, amid calls for caution from across the EU.But the Romanian economy could be missing out on something, pundits say.Four years ago, when the bitcoin price peaked at USD 1,216, it was widely hailed as the next big thing.bitcoin casino script downloadIn 2016, although the price had not managed to regain much ground, the surge in bitcoin use saw experts claim that the moment it would become mainstream was very near.bitcoin offizielle seiteLast month, bitcoin became more popular than gold among investors, Forbes wrote, and the cryptocurrency hit a new record high, USD 1,365.ethereum round

Despite quickly falling by a fifth following speculation over an imminent split due to opposing views over the size of batches of transactions that get processed, it bounced back fairly quickly.Speculation that a bitcoin exchange-traded fund (EFT) could be listed in Europe via an Undertaking in Collective Investments in Transferable Securities (UCITS) structure.ethereal galaxy downloadBitcoin is a decentralized virtual currency that enables peer-to-peer payments to anyone in the world, without the involvement of third parties and bypassing the regulatory powers of central authorities.where to get bitcoin hash rateAll transactions are made via blockchain technology, where a blockchain is a database of ordered records called blocks, which offers a way for unrelated individuals and companies to simultaneously collect and store information via their computers.bitcoin to inr 2015

Although it is still in the process of development, the technology holds much promise.The latest setback, an internal rift between developers, exchanges and entrepreneurs over the opportunity to increase the size of a block – meaning a batch of transactions that can be processed on the network – to more than one-megabyte, hit bitcoin prices.Nevertheless, in a parallel development, since last year, discussions have intensified around the possibility of exporting blockchain, bitcoin’s underlying technology, to the traditional financial sector, where it could be used to redesign the exchange of stock and other financial securities.In February, The New York Times wrote that Microsoft, JP Morgan Chase and other corporate giants were planning to create a new type of computing system based on the virtual currency network ethereum.The projected Enterprise Ethereum Alliance, based on the open, un-permissioned blockchain system, would become a closed ecosystem dominated by major banks.The move, experts noted, is part of a broader movement to harness the technological concept and transfer it to other sectors.

However, in Europe, as in the United States, the playground for other virtual cryptocurrencies such as ethereum, dash and monero, bitcoin is facing legal challenges from central authorities.Bolstered by Silicon Valley, the US currently hosts the highest number of cryptocurrency users, the most bitcoin ATMs of every country, as well as the biggest bitcoin trading volumes in the world.That is why it is expected that the States will be the testing ground for crypto-regulation.However, despite the advance of cryptocurrencies, progress is slow.In March, the US Securities and Exchange Commission rejected a bitcoin-only exchange-traded fund’s bid to list.The move had been hailed as a decisive step towards bitcoin becoming mainstream.Explaining its decision to dismiss the request put forward by fund creators Tyler and Cameron Winklevoss, the SEC said that as it was focusing on a largely unregulated asset, the fund was at risk of fraud, which would make enforcement and surveillance difficult to implement.

The underlying conclusion can only be that currently there is a lack of regulation in the world’s bitcoin markets.Things are not much different back in Europe, where central bank authorities take a more cautious stance than US banks and are urging EU regulators to preserve the status quo.In October last year, the European Central Bank (ECB) published a legal opinion saying that EU institutions should not promote the use of digital currencies.“The reliance of economic actors on virtual currency units, if substantially increased in the future, could in principle affect central banks’ control over the supply of money.Thus [EU legislative bodies] should not seek in this particular context to promote the wider use of virtual currencies,” the ECB said in its official opinion for the European Parliament and Council.Moreover, the financial body asked EU lawmakers to make it clear that digital currencies do not have the legal status of currency or money and called on legislators to tighten the proposed new rules in the area.

The European Commission’s draft rules require currency exchange platforms to increase identity checks on people exchanging virtual currencies for real ones, in a bid to fight terrorism and prevent criminal activities.Such attitudes are understandable, given that bitcoin and other virtual currencies are the cornerstone of decentralization.However, while the advent of virtual currency does not come without risks, the technology is generally regarded as harder to corrupt or hack due to its reliance on many separate actors rather than a single authority.While the use of both of bitcoin and blockchain technology is projected to ultimately become mainstream, Romania has yet to embrace this global trend.According to data released in March by Netopia mobilPay, Romanians made payments in bitcoin equivalent to EUR 300,000 in 2016.The average payment was EUR 400.As for the status of the adoption of blockchain technology by the local banking sector, currently things are moving slowly, judging by the statement issued in February by the National Bank of Romania (BNR).

The Romanian central bank authority has taken a cautious stance towards bitcoin and the use of blockchain technology, echoing in part the attitude of the ECB and reflecting lack of appetite.“We, as a central bank, do not believe very much in bitcoin, because it is not something palpable.Some say it is good to take the blockchain technology and use it, but for what purpose?” asked Ruxandra Avram, BNR head of department, at the Digital Banking & Insurance conference in Bucharest.„Currently, there isn’t any initiative at the level of the central bank to adopt these technologies, because we do not digest them very well” she said, adding, “the ECB has its own reservations.” But Netopia mobilPay founder and CEO Antonio Eram believes the Romanian economy could benefit directly from blockchain technology, while stressing that, as mass adoption is still far off, the advantage could lie with small actors.He sees opportunity in employing blockchain technology “not only for securing some transactions (i.e.