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Dec 05, 2019 at 09:43 // News

Europe limits Bitcoin with anti-money laundering rules

The use of Bitcoin and other cryptocurrencies is still difficult to control and requires scrupulous assessment for any reports to Italian authorities. For now, cryptocurrencies for transactions subject to traceability requirements can be used within the limits of cash. Let’s give some light to the recent anti-money laundering (AML) regulations.

As long as the regulatory framework is not complete, the use of cryptocurrencies in transactions that require the tracking of financial flows remains confined to the cash threshold. The use of cryptocurrencies is in fact scarcely controllable by the national authorities in charge of this and requires the professional to carry out a careful risk assessment for the purpose of reporting a suspicious transaction.

The Nature of Cryptocurrencies

The use of cryptocurrencies is spreading also in sectors other than those of online purchases and cases of real estate sales and corporate transactions carried out with the exchange and use of cryptocurrencies are documented, Italians are faced with a sort of “Digital cash”.

Instead, the exchange and the wallet providers perform services similar to those of currency exchange, money transfers and in general those provided by payment service providers, long considered among the subjects obliged to comply with AML legislation, therefore the extension of objective and subjective AML obligations was somewhat predictable.

When the parties intend to use a cryptocurrency, the professional operator is faced with two main problems: how to comply with the rules on the limitation of the use of cash (Article 49 of Legislative Decree No. 231/2007); how to carry out the analytical indication of the means of payment (pursuant to article 35, paragraph 22, decree-law 4 July 2006, n. 223).

A lively debate is still under way on the legal nature of bitcoins and cryptocurrencies in general: according to some, these new forms of e-money, or “automatic currency”, could be classified as financial instruments or intangible assets, while others believe they consist in payment instruments and the different classification leads to results that are not superimposable from the point of view of the applicable legislation.

The thesis currently most accredited is that which assimilates cryptocurrencies to payment instruments and complementary currencies; thesis accepted by the European Court of Justice itself and by the Revenue Agency (res. No. 72 / E of 2016).

The main point of friction between the virtual currencies and the anti-money laundering legislation is their complete anonymity: the use of the so-called blockchain technology, in fact, guarantees with the distributed register the impossibility of double spending and the IT tracking of the transaction, but the fact that the cryptographic keys that allow the use of cryptocurrencies remain anonymous.

The Relationship with AML Regulations

Hence the need, for the purposes of compliance with the AML legislation, that their circulation takes place through professional operators (exchange and wallet providers) who carry out identification checks of the holders of their accounts.

From November 10, 2019, the new AML regulations regarding cryptocurrencies, exchange and wallet providers came into force, a sign of the legislator’s attention to this world for the possible phenomena of money laundering (ML) that may affect it.

The legislator is well aware that the possibility remains to transfer cryptocurrencies out of the regulated circuits, for example through the mere transfer of the physical wallet that contains them, or through service providers who have their establishment in countries that do not provide for any obligation to identification of its users.

Therefore, as long as the regulatory framework is not complete, the use of virtual currencies in real estate transactions or that in any case require the tracking of financial flows remains confined within the narrow threshold set for cash; the use of cryptocurrencies for higher amounts will be allowed when it will be possible to carry out the analytical indication of the means of payment by making use of operators who respect the aforementioned sector regulations.

In any case a careful assessment of the riskiness of the case by the professional is always necessary since the virtual currencies circuit is in fact scarcely controllable by the national authorities in charge of this and consequently the opportunity to make a suspicious transaction report for ML purposes. By Coin Idol , 2019-12-05 11:43:00 ,

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NewsBlock © 2019 - 2020. All rights reserved.

While Bitcoin’s price seemingly moves without rhyme or reason — collapsing by dozens of percent and embarking on face-melting rallies on a whim — the cryptocurrency market is filled to the brim with fractals.

Related Reading: Analyst: Bitcoin Price Likely to Fall to Low-$8,000s as Chart Remains Weak

A brief aside: A fractal, in the context of technical analysis and financial markets anyway, is when an asset’s price action is seen during a different time. This form of analysis isn’t that popular, but it has proven to be somewhat valuable in analyzing Bitcoin.

One recent fractal popularized by a well-known cryptocurrency trader is implying that BTC is going to return to the low-$7,000s in the coming days.

Bitcoin Fractal Implies Retracement to Low-$7,000s

A well-known crypto trader going by “Tyler Durden” on Twitter recently posted the chart below, which shows that a Bitcoin price fractal may be playing out. The fractal has four phases: horizontal consolidation marked by one fakeout, a surge above the consolidation phase, a distribution, then a strong drop to fresh lows.

If the fractal plays out in full, BTC could reach the low-$7,000s again, potentially as low as $7,100. This would represent a 20-odd percent collapse from the current price point of $8,800.

It isn’t only a fractal that is hinting Bitcoin has the potential to visit its lows. As we reported on Saturday, Bloomberg believes that if the GTI Vera Convergence Divergence Indicator flips red, a downtrend could push the cryptocurrency back to $7,300.

Related Reading: Stephen Colbert Pokes Fun at Bitcoin in Monologue: Mainstream Gone Wrong?

Can Bulls Step In?

But again, many believe it is irrational to have such bearish interpretations of the cryptocurrency’s chart at the moment. As reported by NewsBTC earlier, Popular crypto trader Mayne recently noted that the “people waiting for $6,000” are irrational. He quipped that Bitcoin retracing and consolidating after its fourth-biggest bull move in history ($7,300 to $10,500, a 42% gain) is perfectly par for the course, but noted that it’s totally possible we can go lower from $8,800.

The medium-term technicals support this.

Trader and CoinTelegraph contributor FilbFilb found that by the end of November or start of December, the 50-week and 100-week moving averages will see a “golden cross,” which he claims is far more significant” for the Bitcoin market that other technical crosses.

Also, a Bitcoin price model created using Facebook Prophet machine learning found that the leading cryptocurrency is likely to end the year at just over $12,000. What’s notable about this model is that it called the price drop to $8,000 months in advance, and forecasted a ~$7,500 price bottom for BTC.

To put a cherry on the cryptocurrency cake, Crypto Thies observed that when Bitcoin bottomed at $7,300, it bounced decisively off the 0.618 Fibonacci Retracement of the move from $3,000 to $14,000, which correlates with the two-week volume-weighted moving average. He added that summer 2019’s consolidation was marked by Bitcoin flipping major resistances into support levels, implying that a bullish reversal and subsequent continuation is likely possible in the coming weeks.

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Nick Chong , 2019-11-10 12:00:38

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