After the September 2020 FATF report which called the attention of the cryptocurrency community because it called the use of “decentralized wallets” meaning any type of wallet that is not part of a licensed money transmitter a red flag .
Many deemed the idea absurd and unlikely to be enforced in the US but recent developments like Brian Armstrong’s tweet have shown us that it’s not as unlikely as it seems. This particular type of regulation enforcement already happens in Switzerland under the umbrella term of the Swiss travel rule, meaning that cryptocurrency transactions with licensed exchanges can only happen to and from registered wallets as any other type of activity will be deemed as risky despite this practice being the most safe and widely recommended practice for users.
One can only wonder why this type of nefarious regulation wants to be put in place. The answer is quite simple, this is the way how licensed exchanges and more importantly banks will try to exert control over an industry which exists without the need of banks. It can and will be used to add unnecessary bureaucracy into the cryptocurrency world in the form of banks and exchanges controlling, managing and transacting your cryptocurrency, your funds for you.
For US citizens the answer is simple as well, the regulation must be resisted and citizens should call their representatives to resist such regulations. This article by Coincenter is a great source of education about the matter.
https://www.coincenter.org/how-i-learned-to-stop-worrying-and-love-unhosted-wallets/
Published by: Saxemberg on Nov. 26, 2020