Privacy Rights Battles in the Blockchain Sector
Participants in the blockchain industry and regulators continue to clash over privacy rights as the European Union’s comprehensive Anti-Money Laundering (AML) regulations are set to prohibit privacy-preserving tokens and anonymous crypto accounts starting in 2027.
According to a report in May, credit institutions, financial institutions, and crypto asset service providers (CASPs) will be restricted from maintaining anonymous accounts or dealing with privacy-preserving cryptocurrencies under the EU’s new Anti-Money Laundering Regulation (AMLR), which is scheduled to take effect in 2027.
Anja Blaj, an independent legal consultant and policy expert at the European Crypto Initiative, noted that the struggle to retain access to privacy-preserving coins like Monero (XMR) has been a “constant battle” between stakeholders in the blockchain space and regulators.
Her comments came at a time when the EU is intensifying its regulatory oversight over the cryptocurrency industry, building on the bloc’s Markets in Crypto-Assets Regulation (MiCA).
Although the AML framework is finalized, regulatory experts still see potential for negotiation until it is implemented in 2027.
Policymaking is a “continuous conversation,” Blaj said, meaning that “nothing is set in stone, even if the regulation is already out. There are still ways to either talk to the regulators, see how it’s going to play out, how it’s going to be enforced.”
However, she added that the regulation concerning privacy-preserving cryptocurrencies and accounts is becoming “more stringent because it is not serving the interests and the planning of the states.”
Related Developments
The effort against crypto privacy coincides with a separate EU proposal, known as “Chat Control,” which is gaining traction.
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This proposal would require platforms like WhatsApp and Telegram to monitor every message, photo, and video sent by users, including those that are protected by end-to-end encryption.
Fifteen member states support the bill, but their backing does not currently account for 65% of the EU population—the threshold necessary for adoption. Germany has been cautious, but a shift in policy could be pivotal.
