LocalBitcoins complies with EU measures to end anonymous trades

26 Mar, 2019
by David Robb
Regulation
LocalBitcoins complies with EU measures to end anonymous trades

LocalBitcoins is the first crypto exchange to comply with new European Union measures regarding money laundering, as reported by TheNextWeb. This will stop users from trading BTC anonymously.

The EU's 5th Anti-Money Laundering Directive (5AMLD) will have three basic requirements. It forces crypto exchanges to register with financial authorities, to monitor suspicious customer activity, and to use financial investigators in order to obtain the identities of traders.

Member nations have until 2020 to comply with this new directive. Finland, where LocalBitcoins is based, will be a little ahead of the game, implementing new rules in November 2019. LocalBitcoins has made the decision to update its policies before these regulations come into effect. 

According to a statement, LocalBitcoins aims "to promote trust, legitimacy and maturity in the Bitcoin ecosystem, while paving the way for it to become a more viable and widespread currency and combating criminal use of Bitcoin and its network. We are confident that the new measures will bring significant benefits to our user base, promoting a safer trading environment and acting proactively in preventing fraud."

The exchange is introducing a new identity verification process sometime soon. This will have four different account levels for users, depending on how much many trades they carry out and their total BTC transaction volume. New users will be forced to disclose their identity, but it is not clear if this will apply to existing traders.

Read more: 10 years of Bitcoin: Is Satoshi's vision still alive?"Can Bitcoin Save Venezuelans?" asks NYT opinion piece

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