AML And KYC Laws Will Consider Cryptocurrencies As Legal Tender

According to the recent reports Severe Anti-Money Laundering (AML) and Know-Your-Customer (KYC) laws ought to be implemented for financial regulators and banks to consider cryptocurrencies as a legal tender.

Whereas cryptocurrencies have anonymity, a few nations count the absence of identity linked to a transaction related to a criminal action. For instance, the cryptocurrency-friendly nations of Japan and South Korea, who accepted digital funds before any basic government and still revealed unwillingness in coping with privacy coins such as Monero or Zcash.

Pursuant to the statement of BTCManager, the two nations showed speculation-driven price policy and enlarged opportunities of money laundering as two decisive cofactors in their final decision to prohibit privacy-centric coins.

In spite of the initiative, representatives of the cryptocurrency society on public mediums mean for extra privacy. Forthcoming protocols like the Lighting Network have outwardly embedded this society demand into their code and have established a “second layer” privacy solution which promotes off-chain operations on the Bitcoin and Ethereum blockchains. Meanwhile this does not satisfies Monero’s levels of privacy, the operations are not saved on the blockchains’ mainnet.

This causes a debatable situation. While such resolutions permit companies to enable proprietary information into the blockchain without touching the blockchain, individual or dishonest organization can perform non-monitored trades.

Nevertheless, former banker-turned-cryptocurrency entrepreneur Bob Rutherford says:

“Even if bitcoin is never accepted as a universal currency, financial institutions can’t afford to rest on their laurels. The underlying blockchain technology is going to disrupt the industry — and banks need to be ready for it.”