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Report: UK Treasury plans Bitcoin regulation

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Report: UK Treasury plans Bitcoin regulation

The U.K. Treasury is planning to regulate Bitcoin amid increasing concern that it is being used for money laundering and tax evasion, The Daily Telegraph reported.

The Treasury reportedly said it aims to regulate the virtual currency, which has a value totaling £145 billion, to align it with existing anti-money laundering and counter-terrorism financial rules.

Under the plan, traders in cryptocurrencies will be forced to reveal their identities and flag suspicious activities in the market. Exchange platforms, where digital currencies are traded, and wallet providers, where virtual currencies are stored, will also be required to carry out due diligence on customers and report suspicious transactions. Such measures will put an end to the anonymity surrounding digital currencies, which has made them attractive to criminals and tax avoiders, the Dec. 3 report noted.

"The U.K. government is currently negotiating amendments [to the anti-money-laundering directive] that will bring virtual currency exchange platforms and custodian wallet providers into Anti-Money Laundering and Counter-Terrorist Financing regulation, which will result in these firms' activities being overseen by national competent authorities for these areas," Stephen Barclay, the economic secretary to the Treasury, reportedly said.

The negotiations are expected to conclude at EU level in late 2017 or early 2018, he added.

The announcement comes amid increasing criticism of Bitcoin and other virtual currencies.