EU AML rule bars privacy coin accounts by July 2027, forcing delistings

Article 79 of Regulation (EU) 2024/1624 bars crypto-asset service providers from keeping accounts that anonymise the holder or obscure transactions, naming anonymity-enhancing coins explicitly. The provision applies from 10 July 2027.

The regulation sits in Chapter VIII, formally headed "Measures to mitigate risks deriving from anonymous instruments." The text is binding in its entirety and directly applicable in every member state, requiring no national implementing act. The prohibition addresses companies, not individual investors.

Not a single token name appears in the regulation — no annex, no official list, no register of affected crypto assets. The text works with a functional description: what is barred are accounts that permit anonymisation or obfuscation "to a high degree," with anonymity-enhancing cryptocurrencies named as one route to that end. A narrow exception pushes application to 10 July 2029 for certain obliged entities.

The practical effect is considerable. Kraken removed Monero from its European Economic Area range in 2024, halting trading on 31 October 2024 at 15:00 UTC, closing the withdrawal window on 31 December 2024, and auto-converting remaining holdings to Bitcoin by 6 January 2025. With the 10 July 2027 deadline under eleven months away, platforms are likely to react earlier than the deadline.

Forced conversion carries tax consequences

A conversion triggered by the platform is not a neutral event for tax. Under Section 23 of the German Income Tax Act, private disposal transactions include "disposal transactions involving other assets where the period between acquisition and disposal does not exceed one year." Whether the holder triggers the sale or a provider carries it out after a deadline passes makes no difference. Gains remain tax-free where the total gain from private disposal transactions in the calendar year came to less than 1,000 euros. The decisive factor is the loss of control over timing: anyone who lets the conversion happen can no longer choose the more favourable moment for tax, such as waiting for the one-year period to run out.

Article 79 does not stand alone

Regulation (EU) 2023/1113 on information accompanying transfers of funds and certain crypto-assets already requires certain details to accompany a transfer, applying in step with the European crypto-asset regulation under which platforms hold their authorisation. For crypto assets whose transfers cannot be attributed technically, this creates a tension that exists today already. The anti-money-laundering regulation is the most recent building block, not the only one.

Self-custody and what the regulation does not govern

What is prohibited is the keeping of accounts by companies. A wallet on a device in the holder's hand is not such an account, and a public protocol has no operator on whom a supervisor could impose anything. Article 79 contains no provision barring private individuals from holding a particular crypto asset. What is governed is regulated access — trading, custody and exchange at authorised companies.

Self-custody shifts the risk from the platform to the holder: losing recovery words means losing the holding. It also solves only the custody part — a later exchange into euros requires a service provider again, and whether a regulated provider will still offer that is the open question. Between doing nothing and full self-custody lies a third option: converting the holding at a moment of one's own choosing into something the question does not touch.

This article is for informational purposes only and does not constitute investment advice.