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EU votes in favor of DeFi-crushing law

EU votes in favor of DeFi-crushing law

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EU votes in favor of DeFi-crushing law

Today the European Parliament Committee on Economic and Monetary Affairs (ECON) voted in favor of a proposal that changes the decentralized finance (DeFi) world as we know it.

Or will it? Depends who you ask.

The vote in favor of the proposal, which was “for a regulation of the European Parliament and of the Council on information accompanying transfers of funds and certain crypto-assets”, effectively now means that all non-custodial wallets need to KYC.

The results were: 58 yes | 52 no | 7 abstentions.

Within the proposal voted for is an amendment that states that a “crypto-asset service provider or other obligated entity should obtain and retain the required originator and beneficiary information from their customer, whether originator or beneficiary.”

When it comes to the accuracy of the information, the crypto asset service would be obliged to verify the accuracy of the information in respect to their customer, and it “is not expected to verify the required information with respect to the originator or beneficiary behind the un-hosted wallet”.

It would also require exchanges to notify authorities of all transactions involving an un-hosted wallet if they exceed €1,000.

Brian Armstrong, Coinbase CEO, said it best.

Banter’s take

This is definitely a bad day for crypto and DeFi, and could, as a result, cause the retest we have all been expecting.

Don’t panic.

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