UK Regulators Take Aim At Bitcoin Mixers: What You Need To Know – Benzinga – Benzinga

United Kingdom's National Crime Agency (NCA)is aiming to attackBitcoin(CRYPTO: BTC) mixers services that try to anonymize Bitcoin balances by mixing them, which the regulator saidmakes prosecutingcriminalsharder.

UK Regulator Eyes Bitcoin 'Mixing':Darknet Live, a news outlet focusing on deep web black markets,reportedon Tuesday that Gary Cathcard NCA's head of financial investigation said that Bitcoin mixers can be used to provide a layering service, churning criminal cash, obscuring its origins and audit trail, similar to how a cash business might be used by criminals to legitimize cash through the banking system.

The NCA saidregulation "would force mixers to comply with money laundering laws, with an obligation to carry out customer checks and audit trails of currencies passing through the platforms.

Law enforcement needs access to data necessary to investigate what is often serious criminal activity, according to the U.K. regulator.

Mixers could enable Bitcoin to be easily used for laundering funds involved in ransomware attacks, fraud, state-sponsored crimeand terrorism, according to the agency.

The Royal United Services Institute a leading defense and security think tank pointed out that "free and open-source software algorithms in which there is no entity that takes custody of funds cannot be effectively regulated.

A Bitcoin Wallet's Stance: Samourai Wallet a Bitcoin wallet featuring mixing features answered to an inquiry on the matter with an open letterpublishedon Tuesday, explaining that "Europol also highlighted Samourai Wallet as an emerging 'top threat' in 2020 due to its decentralized nature."

Samourai Wallet said that it believesthe "vast majority" of its users are law-abiding and agreed "that the use of centralized mixers that take possession and custody of funds should be scrutinized and avoided."

The company also wrote that "free and open-source software algorithms in which there is no entity that takes custody of funds cannot be effectively regulated. We believe the NCA should instead focus on more productive methods to prevent serious crime and catch criminals." The firm concluded:

"The argument that crypto users identity is obscured on the blockchain so users shouldnt need to worry themselves with basic financial privacy is not only bad advice, it is a feeble attempt to justify an unprecedented encroachment into the financial privacy of law-abiding citizens."

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UK Regulators Take Aim At Bitcoin Mixers: What You Need To Know - Benzinga - Benzinga