Lithuania To Ban Anonymous Wallets According To EU Regulations

Key points to remember

  • The Lithuanian Ministry of Finance is considering banning non-custodial crypto wallets.
  • The new regulations also place strict regulations on crypto service providers operating within the country.
  • The announcement comes after the recent decision by the European Union to advance anti-anonymity rules in the crypto space.

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The Lithuanian Ministry of Finance has banned anonymous wallets and imposed strict regulations on crypto exchanges in an effort to combat money laundering, terrorist financing, and sanctions evasion. The ministry said it made this decision in anticipation of future European Union decisions.

Lithuania bans self-hosted wallets

The Lithuanian government is seeking to pass a new law to tighten crypto regulations and ban anonymous wallets.

According to the Ministry of Finance, the government on Wednesday approved amendments to the “Law on the Prevention of Money Laundering and Terrorist Financing”, aimed at increasing the transparency of the cryptocurrency sector while ensuring its “development sustainable”. The amendments will have to be approved by the Seimas, the Lithuanian legislative body, before being enacted.

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Among other things, the law seeks to prohibit the creation of “anonymous accounts,” tighten know-your-customer (KYC) regulations for crypto exchanges, and require Lithuania-based exchange management employees to be residents. representatives of Lithuania. The Registrar of Legal Entities will also make public the names of crypto exchange operators.

These measures were justified by the Ministry of Finance as an effort to combat money laundering, the financing of terrorism, circumvention of sanctions from Russia and Belarus and reputational risks for Lithuanian market participants and the Lithuanian state.

Finance Minister Gintarė Skaistė also said that the government is “taking proactive steps to strengthen regulations at the national level in view of subsequent decisions at the national level”. [European Union] level.”

The European Parliament recently voted to advance anti-anonymity rules for the cryptocurrency industry, which would make transactions between non-custodial wallets and crypto service providers much more difficult. The legislation has been criticized by many cryptocurrency advocates, including Coinbase CEO Brian Armstrong.

The number of crypto businesses has grown rapidly in Lithuania following tougher restrictions in neighboring Estonia. While there were only 8 crypto companies created in 2020, the Ministry of Finance says that more than 220 new entities have been created since then.

Disclosure: At the time of writing this article, the author of this article owned ETH and several other cryptocurrencies.

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Lithuania To Ban Anonymous Wallets According To EU Regulations


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