The European Central Bank (ECB) has proposed a directive of the European Parliament and of the Council stating that ‘virtual currencies do not qualify as currencies from a Union perspective,’ and wants digital currencies to be explicitly defined as not legal currencies or money.
In a document titled, Opinion of the European Central Bank [PDF], the ECB is proposing amending Directive (EU) 2015/849 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing and amending Directive 2009/101/EC.
According to the ECB, the use of digital currencies, such as bitcoin, pose a threat as terrorists and criminal groups are able to transfer money within digital currency networks with a certain level of anonymity.
The ECB believes that as digital currencies aren’t required to be exchanged into legally established currencies they can be utilized as for illegal activities.
Such transactions would not be covered by any of the control measures provided for in the proposal and could provide a means of financing illegal activities.
Avoid Promoting Digital Currencies
The ECB has outlined its concerns stating that the Union legislative bodies should not promote the use of digital currencies as they are not legally established as currencies. This