EU’s anti-money laundering rules indicate for crypto
Tuesday’s joint committee vote is expected to result in the passage of the European Parliament’s anti-money laundering legislation.
The European Union’s anti-money laundering package includes crypto assets, which have occupied substantial discussion space. On Tuesday, officials in two European Parliament committees overseeing the measure will vote on its acceptance.
It now comprises some regulations for the crypto sector and EU-based service providers. This vote is a positive development for the law but is still vulnerable to the amendment. After the committee decision, the AML law must pass a plenary vote before interinstitutional discussions may begin.
Also susceptible to the anti-money laundering legislation are decentralized autonomous organizations and decentralized financial platforms.
In contrast to the EU’s forthcoming Markets in Crypto-Assets legislation, the anti-money laundering law does include NFT platforms as required companies. The objective is to fill the regulatory void.
Credit and financial institutions that enable cryptocurrency transactions worth more than €1,000 would be required to implement due diligence procedures. In addition, heightened due diligence processes are in place for correspondent partnerships with crypto service providers outside the EU and self-hosted wallet payments.
Unless the owner of a self-hosted wallet is established, transactions of more than €1,000 in value originating from self-hosted wallets will be restricted for commercial crypto payments. In three years, the European Commission is tasked with determining whether the law on retail costs should be modified to conform with rules such as the European Union’s digital identification framework and the Anti-Money Laundering Authority’s standards.
The rule would restrict both anonymous cryptocurrency accounts and anonymous bank accounts. Other anonymizing techniques, such as privacy wallets, mixers, and tumblers, are deemed riskier. In addition, the Commission will determine whether they should be outlawed.
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