Possible New Bitcoin Regulations worries Coinbase CEO Brian Armstrong! Possible new Bitcoin regulations are what’s being suggested by Brian Armstrong based on “rumors” he had heard. While we don’t know the source of the rumors, this is a good reminder that governments remain vested in tracking all digital transactions, regardless of platform.
Armstrong posted what he’d heard, and his opinions on it, in a series of tweets.
While Armstrong did not mention the source of the rumors, he did offer opinions based on the notion that Coinbase and other companies would need to verify addresses before performing a withdrawal.
For Coinbase users, withdrawals from their wallets would be allowed due to the individual going through Coinbase’s KYC process.
A user could, theoretically, withdraw from their verified self-hosted wallet and then send it anywhere they liked. The cost or burden would be Coinbase’s only, but exchanges are already required to undergo KYC procedures.
Armstrong’s posts seem to point to a larger concern, however – some users withdraw funds from their Coinbase accounts directly to smart contracts – DeFi Apps.
Armstrong also brought up the point that sending more and more information/ID Documents could lead to more hacks. ID theft is a continuing and worrying problem for companies – after all, companies have a poor record of protecting consumer information.
Tokenized IDs could be a solution, and we at CryptoTraders Pro believe that Bitcoin BSV could be a solution. Contracts on the BSV blockchains could have real identities behind them, making KYC simpler for those who need it. BSV’s minute fees could make it the best option for remittance – especially for emerging markets. This is in stark contrast to BTC’s high-fee transactions.
But this is all a mental exercise until we hear more official details from government entities – however, mental exercises might be what we, as an ecosystem, should do. Governments are concerned about anonymous digital asset transactions. This will likely manifest in requiring more ID verification requirements. After all, most exchanges are bound by similar rules to financial institutions in utilizing KYC/AML guidelines to minimize the financing of illegal activity.
There isn’t a mass scale tokenized ID protocol that could fill the niche of KYC, however, this would allow digital asset holders the ability to verify their ID just once, and then use their identity tokens to verify themselves anywhere else. But there isn’t a mass used tokenized ID platform as it would have to be trusted by both governments and users – that just hasn’t happened – yet.
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