European parliament strengthens anti-money laundering rules for digital assets

On April 24, the European Parliament voted on implementing more stringent anti-money laundering regulations targeting the digital assets sphere.

European Parliament Strengthens Anti-Money Laundering Rules for Digital Assets

These regulations are set to influence all participants in the crypto market. The European Union has enacted a comprehensive prohibition on anonymous transactions via custodial wallets or with privacy-centric coins, as well as the use of services offering intensified privacy for both cryptocurrencies and their users.

As outlined in the legislation, all companies must conduct thorough verification of counterparts when digital assets are used to pay for products or services exceeding €1,000 or the equivalent in national currency. This requirement applies regardless of whether the payment is completed through a single transaction or multiple transactions.

Furthermore, service providers operating in the crypto sector will be obliged to adhere to standard Know Your Customer (KYC) and Anti-Money Laundering (AML) requirements.

These regulations exclude software and hardware vendors, as well as developers of non-custodial wallets without access to or control over digital assets. A newly established agency, the Authority for Anti-Money Laundering and Countering the Financing of Terrorism (AMLA), is tasked with overseeing the enforcement of these measures and ensuring their effectiveness.

These provisions are part of the European Union’s strategy to establish a comprehensive framework for managing digital assets and the market. They will work in tandem with the MiCA regulation, which became effective in June 2023.

While the European Parliament has approved the document, it still requires adoption by the Council of the European Union and publication in the EU Official Journal. Following these steps, the law will come into force in three years.

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