- Under new AML regulations, privacy coins such as Monero (XMR) and Zcash (ZEC) are prohibited in the EU in July 2027.
- The market quickly retaliates as XMR and ZEC prices decrease, with entrepreneurs moving to constituents such as Dubai for regulatory relief.
The European Union completed its decision to ban privacy coins and unidentified cryptocurrency wallets on July 1, 2027, marked a decisive turn to the Bloc's anti-money laundering (AML) approach.
Under the newly adopted Anti-Money Laundering Regulation (AMLR), crypto assets that allow unknown transactions-such as Monero (XMR), Zcash (ZEC), and Dash-are prohibited throughout the EU. The move represents a broader effort of regulators to align digital assets with traditional financial systems to reduce prohibited economic activity.
The AMLR requires that all crypto (CASP) service providers (CASP), financial institutions, and exchanges stop supporting privacy tokens or accounts that are obscure customer identity.
Article 79 of the EU before Regulation Plan that the use and maintenance of unknown crypto assets is particularly prohibited, and this is especially proven by the latest AML Handbook of the European Crypto Initiative.
According to regulators, the rules are designed to remove loopholes to existing AML policies that allow crypto users to overcome the transparency standards required by conventional banking systems.
Direct Administration and Market Impact Set to Rehape the EU Crypto Landscape
The prohibition is accompanied by the formation of a centralized body of implementation-the Anti-Money Laundering Authority (AMLA)-which will guard the implementation of the new framework. Beginning in July 2027, AMLA will begin the supervision of at least 40 Casp in six or more EU member states.
Regulation also imposes lighter requirements on crypto transactions. Any single transfer of more than 1,000 euros will now require validation of the sender and recipient's identity before the transfer is completed.
These new policies will contribute to emerging EU regulation plans, following previous frameworks such as crypto-assets (MICA) regulation markets. While the entire implementation details are still pending through the delegate and implementing actions handled by the European Banking Authority, the main direction of legislation is irreversible.
The immediate response to the market has begun. Monero (XMR) and Zcash (ZEC) saw significant price decline following the announcement. XMR dropped 7.2% from $ 128.45 to $ 119.20, while the ZEC declined 5.8% to $ 21.76 within two news hours on May 2, 2025.
Privacy advocates push back as markets move toward crypto-friendly jurisdictions
Critics argue that the EU approach is overreaching. Privacy advocates, including journalists and activists, have warned that blankets that prohibit anonymous tools can erase civil and financial privacy freedom in an increasingly digital world.
They keep that such technologies serve legitimate users who require protection from monitoring or regime of authority.
Meanwhile, regulators find these steps as important in its mission to combat the misuse of crypto property. The EU aims to establish common AML procedures and prevent regulatory regulations between EU member states by implementing transparency in all crypto companies.
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