EU rules that would force all movements of cryptocurrency no matter how small to be traceable by law enforcement authorities are moving forward, with two committees of the European Union parliament voting in favor of draft legislation that would put an end to anonymous crypto transactions in the region.

The bill now moves from committee to an eventual vote by the European Parliament. Though the committees were strongly in favor of the new EU rules, not all of the region’s political parties are on board with the idea. It also naturally faces strong opposition from the crypto community, which points out that this would make transactions even less private than those conducted through banks.

Supporters of the bill have invoked the need for law enforcement to track criminal activity, such as terrorism funding and money laundering, as the reason to end anonymous crypto transactions. The new EU rules would require that law enforcement authorities have access to the source of all crypto assets, no matter how small, and the identity of the beneficiary. Asset transfers would also have to be individually identifiable, and unhosted wallets would be subject to the rules as well. Crypto transactions would also be banned to certain nations designated as “tax havens.”

If the new EU rules go into effect the European Banking ity would be tasked with creating a public register of businesses and services considered to be at “high risk” of facilitating criminal activity. The scrutiny would not be reserved just for these entities, however, but applied to every transaction no matter how minor. Critics argue that this would make crypto less private than the typical bank transaction. Supporters contend that transaction thresholds make laws of this nature easy to get around, but critics point out that one is not expected to report everyday bank transaction such as paying for groceries or gasoline.

The Committee on Economic and Monetary Affairs and the Committee on Civil Liberties and passed it with a strong combined majority: in favor, against and abstentions. The European Parliament vote has not yet been scheduled likely facing a lengthy debate process beforehand, but Bitcoin and other popular funds took a small hit after the news broke.

The news of the proposed death of anonymous crypto transactions was quickly followed by a European Central Bank ECB proposal to exempt small transactions from these checks solely for those using the new “digital euro.” No specific amount was proposed, but the example of € about $ was floated as a reasonable threshold for facilitating standard daily transactions without the burden of scrutiny and reporting to authorities. The original proposal sent to the EU Parliament committee would have allowed all anonymous crypto transactions below €, to be exempt from the new EU rules, an idea that was scrapped in the final draft version. ECB board members have come out strongly against cryptocurrency, calling it “gambling” and a “waste of energy” and attempting to have an outright ban passed.

The industry is rallying in response to save anonymous crypto transactions, with organizations such as Coinbase and the lobbying group Blockchain for Europe running media campaigns and engaging with legislators in a bid to alter or defeat the proposed new EU rules. Such forces have already experienced some recent victories, managing to defeat a measure earlier this year that would have outright banned “proof of work” cryptocurrencies from the EU on the basis of their energy consumption.

The heavy-handed approach to pushing EU consumers away from anonymous crypto transactions and to the euro-backed ECB proposal seems to ignore the central appeal of cryptocurrency; anonymity, freedom from government scrutiny and a lack of connections to fiat currencies and their associated regulations. The digital euro is not slated to launch at least until , but early surveys from have signaled a lukewarm reception to the idea throughout the region with one finding that only % were interested in the idea and % were opposed to it. % also felt that the introduction of a digital euro would have no impact on established cryptocurrencies like Bitcoin.

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Other surveys conducted by the ECB indicate that privacy is the foremost concern of those that have interest in the digital euro, and that inadequate privacy would be a dealbreaker for them. About half of the survey respondents also supported caps on how many digital euros one can own and penalties on carrying balances above a certain amount.