Biden pauses controversial “Know your customer” measure in the digital asset market

Although the put on pause It is not only against this particular regulation proposal, but also against the generality of the regulations in progress for a period of 60 days. Why? Simply to give enough time to the persons appointed to the different government cabinets so that they can catch up with their nature and, if necessary, rethink their need for regulation.

Measurements "Know Your Costumer"? It is about the measures taken by the financial sector to combat money laundering, terrorist financing, and various other situations of corruption. In that sense, it seeks to formally identify the customers behind each of the transactions it carries out.

What is the impact on the digital asset market? The regulation proposal of December 2020 seeks that cryptocurrency exchanges identify the people behind the exchange transactions they carry out in their businesses. Does it apply to all transactions? No, only those that exceed USD 3,000 dollars (an amount that will not be very difficult to comply with for most transactions, even those that are carried out by natural persons), he pointed out. Criptonoticias.

But the obligation does not stop there, if the operation exceeds USD 10,000, the next thing they should do once they have identified the agents of the transactions is to send that information to the Financial Crimes Enforcement Network (FinCEN) of States. United

How did the crypto world receive the measure? Although a negative answer was to be expected, the important thing is to know the arguments. On the one hand, the Coinbase (crypto trading platform) board noted that it was “a significant intrusion on the privacy of the owners”. For their part, Kraken and BitGO (exchanges) also described it as dangerous and violating human rights. In the same vein, the CEO of Square, Jack Dorsey considered that it was an unnecessary proposal "since such requirements are not required by the authorities when citizens mobilize the same amount of cash"

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Marilú Lazo
Lawyer from the Pontificia Universidad Católica del Perú (PUCP). Director of The Crypto Legal Blog, she has experience in corporate advice, consumer protection, as well as in matters of personal data protection and new technologies.


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