Texas may soon require ID verification from crypto users

10 Mar, 2019
by David Robb
Regulation
Texas may soon require ID verification from crypto users

New legislation proposed in Texas may lead to more restrictions in the use of cryptocurrencies. If passed, the bill will require identity verification for all crypto transactions.

This new bill was proposed by Rep. Phil Stephenson, a Republican, and it could be one of the biggest anti-crypto moves carried out by state legislature so far. It would prevent any crypto transaction where the sender's identity is not verified beforehand. No further information is given about what kind of verification would be necessary, and the specifics of how these rules would be enforced are unclear.

The draft seems to insist on a difference between "verified-identity digital currencies" and others, perhaps hinting at privacy coins such as Monero (XMR). It recommends the development of tools that will allow people to distinguish between different types of digital tokens, as well as educating law enforcement, and is intended to promote the use of cryptos that allow identity verification. 

Compliance with KYC (know your customer) requirements is becoming increasingly important for major crypto trading platforms, with legislators of various kinds seeking to protect investors, as well as prevent illicit activities being carried out with crypto. The anonymity of the technology is a major problem for many U.S. authorities, and has led to outright bans in many other national jurisdictions.

Read more: Why hasn't the SEC approved a Bitcoin ETF yet?Why it's good you're still in cryptocurrency in 2019

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