Yesterday, the EU Commission announced that it will propose tighter regulation of cryptocurrencies to combat money laundering and terrorist financing. The proposal would affect both the trading and anonymous storage of cryptocurrencies. On the day of the announcement, popular cryptocurrencies such as Bitcoin and Ethereum experienced a temporary price collapse.

The proposed new law includes a bid to give governments across the EU greater authority over cryptocurrencies, meaning that transactions involving currencies such as Bitcoin, Ethereum, and Ripple will soon be fully traceable.

The announcement (via. Golem.de) states, "These proposals are part of the European Commission's efforts to protect EU citizens and the financial system from money laundering and terrorist financing. These proposals aim to facilitate the detection of suspicious transactions and activities and close loopholes that criminals use to launder criminal proceeds through the financial system and to finance terrorist activities.

The plans also point to a cash limit of €10,000 ($11,777) and a ban on anonymous cryptocurrency wallets.

"Restricting high cash payments makes it more difficult for criminals to launder dirty money. Additionally, anonymous cryptocurrency "wallets" would be prohibited, as would anonymous bank accounts.

There is no word on what this means for those who currently possess anonymous cryptocurrency wallets, but if all is agreed upon, future wallet setups will provide personal data to the government.

According to Coindesk's price chart, the price of bitcoin plummeted by about $1,000 (£733) and ethereum by $94 (£69) between midnight and 5 am on July 20 following the announcement. Throughout the day, prices oscillated at about $29,600 and $1,700, respectively, but both now appear to have recovered.

Of course, it is not certain whether pricing was directly affected by the proposal. Correlation does not imply causation and all that, but when the changes are finally made, the impact on the cryptocurrency market will undoubtedly be noticeable.

Lord only knows how many cryptocurrencies the shady "so-and-sos" hold.