Starting December 30, 2024, a major change is coming to the world of cryptocurrencies in Europe. With the entry into force of the MiCA regulations, the TFR (Transfer of Funds Regulation) will also be applied. Here is a breakdown of what will change.
What is TFR?
The TFR aims to strengthen the fight against money laundering and the financing of terrorism. This involves increased monitoring of cryptocurrency transactions. The idea? To require exchange platforms to collect and transmit personal information during transfers of digital assets.
Concrete example:
When you send crypto from one regulated exchange to another, data like your name, surname, and address will need to accompany the transaction.
For self-hosted wallets (like MetaMask), if the amount exceeds €1,000, you will need to prove that the wallet belongs to you.
This information is not shared publicly but will be kept by the platforms and accessible to authorities in the event of an investigation.
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Why is it important?
1. Strengthen security: The stated objective is to limit the illegal use of cryptocurrencies.
2. Debates on privacy: Many are concerned that this regulation will encroach on individual freedoms and respect for privacy.
3. Impact for users: Platforms will have to adjust their tools, and users could face more verifications.
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Criticisms and concerns
Some voices in the sector, such as Nicolas Louvet (CEO of Coinhouse), believe that this measure could be ineffective. By seeking to control everything, it would especially risk complicating the lives of honest users, while leaving loopholes for real criminals.
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What to do as a user?
Stay informed: Check your exchange platform's policies.
Anticipate changes: If you use self-hosted wallets, be prepared to have to prove ownership.
Monitor your transactions: Transfers to regulated platforms will become the norm.
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The TFR marks a new step in the regulation of cryptocurrencies in Europe. But one question remains: will these measures achieve their objective or do they risk stifling innovation? Time will tell.