Europe Strengthens Crypto Regulations With New Anti-Money Laundering Laws

Crypto asset service providers (CASPs) in Europe should implement strict know your customer (KYC) procedures to combat money laundering following the European Parliament’s green light on the new anti-money laundering regulation of silver (AMLR), according to an April 24 report. statement.

According to the press release:

“The new laws include enhanced due diligence measures and customer identity checks, after which so-called obliged entities (e.g. banks, asset and crypto-asset managers or real estate and virtual agents) must report suspicious activities to FIUs and other relevant authorities. .”

The law also includes non-financial sectors subject to money laundering or terrorist financing, such as gaming and sports clubs.

Under the AML, a new regulatory body called the Anti-Money Laundering and Counter-Terrorism Financing Authority (AMLA) will oversee and enforce the revamped protocols.

Notably, this development mainly affects centralized exchanges under the EU crypto asset markets (Mica) umbrella.

MiCA is crucial legislation for the crypto sector in Europe and provides essential regulatory clarity for this growing industry. Market observers have argued that this framework highlights the region’s recognition of the sector’s potential. MiCA was signed into law in June 2023 and will become enforceable by the end of this year.

Expected result

Patrick Hansen, Director of European Strategy and Policy at Circle, underlines that the results of the votes were awaited, adding that:

“As expected, the European Parliament plenary adopted the new AML package, including the AML Regulation, by 479 votes in favor, 61 against and 32 abstentions. The package will now also be formally adopted by the EU Council and will enter into force three years later.”

In a separate article, Hansen underlines that the regulations largely reflect existing anti-money laundering lawsechoing the provisions of the MiCA Regulation prohibiting privacy coins and the Transfer of Funds Regulation (TFR).

Notably, initial proposals threatening the crypto sector have been scaled back. These included proposals capping self-custody payments at €1,000 and subjecting decentralized autonomous organizations (DAOs), DeFi and non-fungible token (NFT) platforms to AMLR obligations.

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Published in: EU, Regulation

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