KyberSwap, one of the largest non-custodial cryptocurrency exchange is moving out of Malta to the British Virgin Islands.

According to an email sent by KyberSwap to its registered users on Thursday, it is making this move in response to the Fifth Anti-Money Laundering Directive (5AMLD), which went into effect on Jan 10th.

Fifth anti-money laundering directive:

According to 5AMLD requirements, EU crypto firms need to implement customer due-diligence (AML) and identification requirements (KYC) measures. This would require crypto firms to maintain user transaction or interaction records with their product or service and even obtain user financial sources.

The new regulations would put too high a barrier for the majority of crypto businesses operating from the EU, both – “regulatory and cost-wise”. As a result, many have decided to operate their business elsewhere and few even closed down.

Other crypto firms impacted by EU’s 5AMDL:

Many crypto firms believe the new rules will compromise user privacy and hence, alter the user experience. Therefore rather forcing this onto their users, the startups are moving their business out of the EU.

Crypto derivatives platform Deribit who leads the Bitcoin options market by volume is another such firm that recently announced moving their business out from Netherland to avoid the directive.

Few crypto startups have even shut down their business. These are Bottle Pay – who were working on enabling Bitcoin micropayments across social media and messaging apps, Simplecoin – a cryptocurrency mining pool firm, and Chopcoin – Bitcoin gaming platform.

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