European Union Cracks Down on Bitcoin Exchanges

European Union states and legislators agreed on Friday on stricter rules to prevent money laundering and terrorism financing on exchange platforms for bitcoin and other virtual currencies, the EU said in a statement.

The agreement is part of a broader set of measures to tackle financial crimes and tax evasion. EU legislators also backed stricter controls on pre-paid cards, and raised transparency requirements for the owners of trusts and companies.

“Today’s agreement will bring more transparency to improve the prevention of money laundering and to cut off terrorist financing,” Europe’s Justice Commissioner Vera Jourova said.

The EU decision comes as bitcoin’s prices have risen more than 1,700 percent since the start of the year, triggering worries that the market is a bubble that could burst in spectacular fashion.

The agreed measures will end anonymous transactions on virtual currency platforms and with pre-paid payment cards, which investigators said could have been used to fund attacks by militants.

Bitcoin exchange platforms and “wallet” providers that hold the cyber currency for clients will be required to identify their users, under the new rules which now must be formally adopted by EU states and European legislators and then turned into national laws within 18 months.

Read more at Reuters