EU Reached a Consensus on Cryptocurrency
Anti-Money Laundering Regulations
European institutions have come to a provisional agreement on a set of EU legislation that would require cryptocurrency businesses to assist in the fight against money laundering and other illegal activities that might use digital assets. The Union is making headway in its efforts to completely control the continent's crypto economy.
An agreement has been reached on anti-money laundering (AML) regulations that will require businesses in the cryptocurrency industry to authenticate the identities of their customers and report suspicious transactions. The rules were agreed upon by negotiators representing the major players in the EU's decision-making process. Furthermore, Transactions using cryptocurrencies will eventually be covered under Europe's Transfer of Funds Regulation (ToFR).
The laws still need to be completed and approved by the appropriate European organisations, but the preliminary agreement now in place foreshadows a tightening of the rules for the industry. The European Parliament and EU Council said on Wednesday that cryptocurrency companies will need to support financial authorities' efforts to combat "dirty money."
According to sources, who cited a recently issued government statement, “the greater monitoring should ensure that crypto assets can be tracked exactly like regular money transactions. With the use of the new rules, law enforcement officers will be able to connect some transfers to illegal activity and pinpoint the true source of such transactions,” according to Spanish Green Party lawmaker Ernest Urtasun, who participated in the process and was quoted by the sources for his explanation.
The EU organisations also stated that the regulations would apply to "unhosted" crypto wallets, a word used by European officials to describe private individual wallets that are not handled by a licenced platform. This restriction will be enforced for transactions with cryptocurrency service providers that cost more than €1,000 ($1,040; approximately). In a letter delivered to the 27 EU member states' finance ministers in mid-April, businesses dealing with cryptocurrency assets requested European politicians to guarantee that their legislation did not go beyond the norms approved by FATF, the worldwide Financial Action Task Force.
On Thursday, the EU will also want to reach consensus on a comprehensive framework that would govern crypto-related activity all over the Union. The new Markets in Crypto Assets (MiCA) legislative proposal, which is anticipated to take effect by the end of next year, requires that members of the European Parliament and officials from EU member states coordinate their stances. Following that, crypto businesses will have another 18 months to apply for a MiCA licence in order to conduct business in the EU.
