[false] Denmark bans self-custodial wallets

[NotATether]

This is absolutely nothing to be afraid of, or even give attention, any country can ban anything related to crypto they want, or even crypto in its entire self, but the issue have always been in its implementation.
For example, Nigerian government banned crypto entirely in the whole of the country, but it's citizens still go about crypto like there was or is no ban at all, I believe this will be the same story in Denmark, how are they going to effect this ban? To make sure that citizens don't continue using self custody wallets even after this ban? There is no way to implement such a rule, even if they restrict citizens access to the domains of those wallets, citizens can always use VPN to bypass such restrictions.

Well, Nigeria is different I guess. Nobody wants to use the naira there as far as I know because it's too inflated and made buying everything much more expensive. Denmark doesn't have this problem, and as far as I know they are not banning crypto outright anyway, so unfortunately it is not going to get as much attention inside the country as it deserves. Businesses etc. will not care for example, nor will those who keep their balance on an exchange.

[Stompix]

Has anyone actually read the text of the proposal?

The reason for this briefing is that Regulation (EU) 2023/1114 of the European Parliament and of the Council on markets in crypto-assets (MiCA) does not apply to activities otherwise covered by the regulation if they are in practice provided in a fully decentralised manner. The Danish FSA therefore sees a need to identify the fundamental principles that all crypto market
participants should consider before characterising their activities as decentralised - and thus not covered by MiCA.

When China banned bitcoin mining everyone was FUD! FUD! FUD!, now we have a guy on Twitter who only cares about his business screaming something that is debunked by the first paragraph of the proposal and everyone believes it!
Seriously?

[0t3p0t]

Bwahahaha (sorry, I am actually pissed)

The finance department of Denmark is set to ban self-custodying your Bitcoin. That mans you can't legally store your coins in Bitcoin Core (what about miners??), Electrum, Sparrow, Unstoppable, BlueWallet, and pretty much all hardware wallets and software wallets.

These guys must be really pushing hard for you to use an exchange.

It's like everyone forgot how catastrophically FTX imploded just 18 months ago.

It's important to note that Denmark is part of the EU, and so we might see similar regulation on their part as a larger level eventually.

https://coingape.com/danish-regulator-to-ban-unhosted-bitcoin-btc-wallets/

Really fucked up move by them.

Crypto is about to get some very hard hits in quite a few countries.

And I think more will follow on this kind of restrictions. The crypto enthusiasts of Denmark is now surely thinking of an alternative way to still able to hodle crypto eithout any trace from their government and hopefully they can still manage to use and hodl crypto freely one day. If this will happen here in my country it really hurts because I personally use non-custodial wallets ever since I came into crypto. Though I use centralized local crypto exchanges but only for withdrawals.

[KingsDen]

This is absolutely nothing to be afraid of, or even give attention, any country can ban anything related to crypto they want, or even crypto in its entire self, but the issue have always been in its implementation.
For example, Nigerian government banned crypto entirely in the whole of the country, but it's citizens still go about crypto like there was or is no ban at all, I believe this will be the same story in Denmark, how are they going to effect this ban? To make sure that citizens don't continue using self custody wallets even after this ban? There is no way to implement such a rule, even if they restrict citizens access to the domains of those wallets, citizens can always use VPN to bypass such restrictions.

Well, Nigeria is different I guess. Nobody wants to use the naira there as far as I know because it's too inflated and made buying everything much more expensive. Denmark doesn't have this problem, and as far as I know they are not banning crypto outright anyway, so unfortunately it is not going to get as much attention inside the country as it deserves. Businesses etc. will not care for example, nor will those who keep their balance on an exchange.

Nigeria didn't ban cryptocurrency in its entirety. They only placed ban on its transactions. This means Nigerian banks and other financial institutions cannot sell or buy bitcoin for you and also should not allow themselves to be used as means to completing cryptocurrency related transactions. The consequences is freezing of the victims account and/or penalizing the involved bank. With this, people of Nigeria relied so much on P2P and also use same banks for transactions but in the narration, they will not include any crypto related keywords. So, there's a clear loophole to be used by Nigerians to boycott the restriction.

But in Denmark, it is a ban of self custody and encouragement of transacting with exchanges. It is directly opposite of Nigerians fate. Also note that it is not all the countries that has weak policy enforcement. Many countries enforce to the later whatever they pass to law.

[Asiska02]

This is absolutely nothing to be afraid of, or even give attention, any country can ban anything related to crypto they want, or even crypto in its entire self, but the issue have always been in its implementation.
For example, Nigerian government banned crypto entirely in the whole of the country, but it's citizens still go about crypto like there was or is no ban at all, I believe this will be the same story in Denmark, how are they going to effect this ban? To make sure that citizens don't continue using self custody wallets even after this ban? There is no way to implement such a rule, even if they restrict citizens access to the domains of those wallets, citizens can always use VPN to bypass such restrictions.

Well, Nigeria is different I guess. Nobody wants to use the naira there as far as I know because it's too inflated and made buying everything much more expensive. Denmark doesn't have this problem, and as far as I know they are not banning crypto outright anyway, so unfortunately it is not going to get as much attention inside the country as it deserves. Businesses etc. will not care for example, nor will those who keep their balance on an exchange.

Nigeria’s case and Denmark’s are different and they cannot be compared to each other. Like in Nigeria, there’s a ban on using cryptocurrency and the government is just after banning exchanges and enforcing them to remove the p2p services on their platform because that’s where they think Naira is being inflated. After removing the p2p services from many exchanges like Binance, KuCoin and OKX; the major ones, it doesn’t still solve the problem with few of them left now that Nigerians uses for p2p transactions. Citizens still use crypto daily like nothing ever changed.

But in the case of Denmark, I think their mission is to find a way to equip the exchanges because if you can only save your coins in exchanges, it has exposed your coin to hack or even monitoring by the authorities. As long as this is concerned, I will still prefer to bank on the Nigerians rules on cryptocurrency than that of Denmark.

[philipma1957]

I wonder if. DENMARK will be forced. TO insure the coins on exchanges.

Usa insured $250,000 at a bank. Cash not crypto.

But if you are forced to usa an exchange and not insured I see a lot of issues.

[KingsDen]

I wonder if. DENMARK will be forced. TO insure the coins on exchanges.

Usa insured $250,000 at a bank. Cash not crypto.

But if you are forced to usa an exchange and not insured I see a lot of issues.

Maybe no much issues. Maybe the exchanges will have a reserve in the government bank or the government Central Bank will buy and sell share to the exchanges, just like how they regulate and monitor fiat banks. If the exchanges have a reserve in government custody and something like hack happens, the government will step in to compensate people. Just a speculation though!

[joniboini]

So based on the chart shared above, it looks like this mainly targets centralized services or businesses that offer wallet/custodial service no? I can see why some people believe the ambiguity of the term used can lead to stricter control or ban of self-custodial wallets, so clarifying that would help debunk any misleading statement. If I read this correctly basically any wallet provider like Coinbase needs to register with the authority to continue their service over there, but wallets like Elctrum won't require the same thing. CMIIW.

[Stompix]

So based on the chart shared above, it looks like this mainly targets centralized services or businesses that offer wallet/custodial service no? I can see why some people believe the ambiguity of the term used can lead to stricter control or ban of self-custodial wallets, so clarifying that would help debunk any misleading statement. If I read this correctly basically any wallet provider like Coinbase needs to register with the authority to continue their service over there, but wallets like Elctrum won't require the same thing. CMIIW.

Too late, somebody spread the rumors the evil gubbermint will come after our wallets nobody is going to listen to the actual law and check if that is actually true.

No, Denmark did not propose banning self-custody wallets
https://cointelegraph.com/news/denmark-no-ban-self-custody-wallets

“Hardware wallets do not give custody of private keys to the wallet provider and thus are not regulated by MiCA. Non-custodial wallets, by their nature, are not subject to MiCAR.”

Let's see, will anyone read this update just go by the title and again put their tinfoil hat on!

[dkbit98]

Well, Nigeria is different I guess. Nobody wants to use the naira there as far as I know because it's too inflated and made buying everything much more expensive. Denmark doesn't have this problem, and as far as I know they are not banning crypto outright anyway, so unfortunately it is not going to get as much attention inside the country as it deserves. Businesses etc. will not care for example, nor will those who keep their balance on an exchange.

I think they are forced by government to use Naira for all local purchases, but they are using cryptocurrency like usdt and btc with p2p trading.
Denmark currently doesn't have hyperinflation, but same thing can happen with Krona and with any other fiat currencies that are backed by nothing and use central banking.
New laws are usually just a preparation for what is coming in future, and most people are sadly using custodial wallets and exchanges 

Any wallet that have integrated exchange swaps will be affected by new Mica stupidity:

Despite not being subject to MiCA, some software wallets provide integrated interfaces to fully decentralized services in addition to their wallet services. According to Thygesen, such integrations could potentially be independently regulated by MiCA if they are not provided fully decentralized.

For example, a software wallet that directly executes orders on a decentralized exchange on behalf of clients could require authorization if a legal entity has control over the offer and provides this specific activity as a service for clients, the DFSA official said.

https://cointelegraph.com/news/denmark-no-ban-self-custody-wallets

[NotATether]

Too late, somebody spread the rumors the evil gubbermint will come after our wallets nobody is going to listen to the actual law and check if that is actually true.

No, Denmark did not propose banning self-custody wallets
https://cointelegraph.com/news/denmark-no-ban-self-custody-wallets

“Hardware wallets do not give custody of private keys to the wallet provider and thus are not regulated by MiCA. Non-custodial wallets, by their nature, are not subject to MiCAR.”

Let's see, will anyone read this update just go by the title and again put their tinfoil hat on!

It is good that they clarified this, it would've been a shitstorm if it were actually true.

According to the previous chart you posted, it would appear that this doesn't affect crypto businesses incorporated there either - just a very specific kind of offering (or whatever it is supposed to be, I don't understand a few of the terms in the graph).

Any wallet that have integrated exchange swaps will be affected by new Mica stupidity:

Despite not being subject to MiCA, some software wallets provide integrated interfaces to fully decentralized services in addition to their wallet services. According to Thygesen, such integrations could potentially be independently regulated by MiCA if they are not provided fully decentralized.

For example, a software wallet that directly executes orders on a decentralized exchange on behalf of clients could require authorization if a legal entity has control over the offer and provides this specific activity as a service for clients, the DFSA official said.

https://cointelegraph.com/news/denmark-no-ban-self-custody-wallets

Key word being exchange swaps so this sounds more like this affects wallets like Atomic and Guarda or anything else integrating with Changely/NOW, both owned by a shady entity which should keep you away from using them anyway.

[Pastaral]

I think there is nothing to pay attention to.  Because there are many countries that have banned crypto completely.  In my opinion not all countries have the same beliefs like Denmark.  Despite the ban in Denmark, there are many citizens of the country working in cryptocurrencies. To bypass such restrictions, VPNs can be used.

[Stompix]

According to the previous chart you posted, it would appear that this doesn't affect crypto businesses incorporated there either - just a very specific kind of offering (or whatever it is supposed to be, I don't understand a few of the terms in the graph).

Any wallet that have integrated exchange swaps will be affected by new Mica stupidity:

Despite not being subject to MiCA, some software wallets provide integrated interfaces to fully decentralized services in addition to their wallet services. According to Thygesen, such integrations could potentially be independently regulated by MiCA if they are not provided fully decentralized.

For example, a software wallet that directly executes orders on a decentralized exchange on behalf of clients could require authorization if a legal entity has control over the offer and provides this specific activity as a service for clients, the DFSA official said.

https://cointelegraph.com/news/denmark-no-ban-self-custody-wallets

Key word being exchange swaps so this sounds more like this affects wallets like Atomic and Guarda or anything else integrating with Changely/NOW, both owned by a shady entity which should keep you away from using them anyway.

It's pretty easy
- you offer a self-custody wallet like electrum and you don't offer any services on top of that they don't care
- you offer a self-custody wallet but you offer services like swapping, and investments, staking, bla bla, from which you take profit that requires you to have a license? You need to register!

But in case I offer a wallet again self custody but my wallet allows the users to print their own tokens, create runes or anything else, again, it's not covered by MICA, much like creating LN channels in electrum is not!

Anyhow, thanks a lot for updating the title!
I hope the guy on twitter comes out and apologies for all the misleading crap and his 4 pages of "research".

Despite the ban in Denmark, there are many citizens of the country working in cryptocurrencies.

D'oh! 

[dkbit98]

Key word being exchange swaps so this sounds more like this affects wallets like Atomic and Guarda or anything else integrating with Changely/NOW, both owned by a shady entity which should keep you away from using them anyway.

Yes, bet there are many other wallets, and this could affect many Lightning Network wallets also.
I am not sure about Wasabi wallet that is using centralized coordinators, but Exodus wallet and some hardware wallets have similar third party partners, so better be careful if you are exchanging coins with them.

[Faisal2202]

- you offer a self-custody wallet but you offer services like swapping, and investments, staking, bla bla, from which you take profit that requires you to have a license? You need to register!

As if according to MICA the company won't be sued if its don't own the keys, but if it integrates swapping, and other functions then it will be because recently USA's authority SEC sued Consensys for implementing swapping (and other functions) for unregistered securities and they want to shut it down.

Considering that POV I think MICA will also have the same rule because they have to provide funds for swapping and other functions and thus they are involved. I say if a company want to create a decentralized or self custodial wallet, they should not integrate any other functions in them to avoid themselves from any lawsuits.