EU Parliament Approves Wallet Host Identity Revealing Bill for a Final Vote

Key Insights:

• The ECON – LIBE voting session ended with the bill receiving majority support.
• The bill is not expected to observe friction during the final vote either.
• Crypto community observes this as a massive blow to self-hosted wallets.

The sovereignty of crypto lies in its decentralization, anonymity, and independence, but it seems like the EU Parliament does not much care for it.

The voting session that ended today puts the entire existence of self-hosted wallets at threat of extinction as no one would be willing to lose their right to anonymity in the European Union.

Another Threat to Crypto

The ECON – LIBE voting session released the results of the roll-call votes in which the votes were tallied as 58 for, 52 against, with 7 abstentions. This results in the approval of the amendments to the Transfer of Funds Regulation.

According to these amendments, crypto service providers will be required to verify the self-hosted wallets, which are also known as “Unhosted wallets”, owners’ identities. 

However, the threat doesn’t stop just at these wallets as the crypto service providers, primarily cryptocurrency exchanges, would also fall into the crosshairs of the regulators.

And the approval of this bill would provide the regulators with the ammunition to constantly monitor them, killing the purpose of crypto.

The reason people choose these self-hosted wallets is to ensure privacy and protection.

Still, the EU Parliament intends on abolishing that as the potential threat of an unwarranted investigation into one’s business would keep people away from using them, thus bringing an end to this service in the EU.

The Trilogues

As the bill proceeds for its final voting, there is a tiny chance that it would observe any opposition. But things could change during the Trilogues with the European Commission and the European Council. 

Expected to begin within the next two weeks by mid-April, the Trilogue could result in the bill facing ramifications. 

Usually, formal trilogue negotiations are carried out within the framework of a conciliation committee, the European Commission being in this case.

The result of the trilogues is the official decision of the conciliation committee, which cannot be challenged by either the EU Parliament or the EU Council.