Recently, ISIS threatened Britain with so savage a terror attack that it will ‘turn babies’ hair white.’ The threat was enough to send chills down the spines of anyone, and everyone.
The European Commission has laid out an Action Plan for strengthening the fight against terrorist financing in its 15-page report a couple of days after the threat.
The report pointed out that the European Union has been battling an increasing number of terrorist activities, and all channels of terrorist funding should be targeted and stopped to put an end to Jihadi actions.
The Commission realized that virtual currencies such as bitcoin present new challenges in terms of combating terrorist financing. Virtual currencies, being anonymous in nature, have been rumored to be involved in terrorist activities. However, there has been no real proof pertaining to this allegation in common knowledge.
“Highly versatile criminals are quick to switch to new channels if existing ones become too risky. For innovative financial tools, it is critical to be able to manage the risks relating to their anonymity, such as for virtual currencies. Critical to this question is less the forms of payment themselves, but rather whether they can be used anonymously.”
The report proposes regulation of virtual currency exchange platforms as the transactions are not reported as in the traditional banking system. Non-reporting of transactions makes it hard to identify the parties involved in virtual currency transactions, thereby increasing the risk of concealed sources of terrorist funding.
The EC plans to bring the virtual currency exchanges under the Anti-Money Laundering Directive (AMLD) to obstruct the now free-flow of digital money in terrorism. Surprisingly, the report missed out on setting a fixed deadline for implementing the said measures.
But like always, actions will speak louder than words, and the actions need to happen sooner than later.
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