The European Union will ban privacy coins and anonymous cryptocurrency accounts by July 2027, in an effort to curb illicit use of cryptocurrencies. The new anti-money laundering (AML) rules will require identity verification for cryptocurrency transfers over 1,000 euros.

Cryptocurrency service providers (CASP), including exchanges and financial entities, will need to collect customer identification data (KYC) for all users or cease offering services within the EU. This measure aims to establish uniform AML procedures and prevent regulatory arbitrage among EU member states, demanding transparency from all cryptocurrency companies.

Regulators argue that privacy coins facilitate covert criminal operations and money laundering. While some criticize the ban as a harsh measure that could stifle innovation and individual privacy, the EU seeks to align cryptocurrency regulations more closely with traditional banking.