With this legislation, every transaction you make via a centralized exchange is reported directly to the relevant authorities in your country. So I would expect a lot more cases of people having accounts locked or coins seized pending some nonsense investigation because some sketchy blockchain analysis has decided that you might be a criminal.
nope. the MSB(exchange/service provider) has to locally log everything.. with the potential to use analysts and compliance officers employed by the MSB to use their minds and algorithms to check for suspicious activities. where by if something reaches a certain threshold of suspicious activity of illicit crimes (laundering/hacking/terrorism/tax evasion) THEN it is passed onto authorities
its not a default 'report everything
funny part is by people asking innocent users to now use 'mixers' before depositing into an MSB. guess what. that MSB will see the mixer and immediately red flag it as suspect of laundering.
yep sometimes trying to be too careful by giving false iID and mixing, actually makes you more noticable and worthy of looking into more.
analogy
its like oeleo's/blackhatcoiner's favourite hobby. stalking people.
(second hobby is being the worse ever door-to-door salesmen of an altnet)
by crouching down and hiding behind bushes to hope to not be seen.. the neighbours notice a strange guy sneaking around and report him to the cops.
if he simply walked along the path, standing tall and just followed his victim.. no one would bat an eyelid and no one would be concerned.
EG (watch a genuinely good spy movie)
do you think spies crouch down and hide behind bushes. no. their stalking is less noticeable. they hide in plain sight by not hiding.. by just acting like a normal person taking a casual walk
however oeleo and blackhatcoiner are promoting practices to get you more noticed and flagged as suspicious
their game is to get people reported to then pretend the person got reported because the MSB is over-reaching..
reality is this
yes MSB log details and have a X year statute of limitations on how long they can keep that info. but if you are doing nothing suspicious. the authorities never get a report on you and that data gets deleted after X years.
however do things like use mixers and give fake ID 'to preserve privacy' will get you flagged by the MSB they will look into you and investigate you and decide if your worthy of being reported