The Latest Updates on European Crypto Regulation Against Money Laundering
Your guide to understanding the recent developments in the European Parliament’s approval of new anti-money laundering regulations for the cryptocurrency industry.
The Concerns over Non-Custodial Wallets
- Recent protests linked to alleged restrictions on non-custodial wallets
- No evidence of a ban on non-custodial wallets, but increased transaction complexity
- New regulations applying to all obligated entities, including crypto and non-financial institutions
- Rules focusing on service providers, not hardware or software providers
- Clarification on regulations not directly impacting non-custodial wallets themselves
The Implications of the New Anti-Money Laundering Rules
Exploring the key points of the EU’s latest anti-money laundering regulations for the cryptocurrency sector.
Formalizing Existing Procedures
- Full enforcement slated for the second half of 2024
- Focus on CASPs (Cryptocurrency Service Providers) under MiCA regulations
- Mandatory adherence to standard KYC/AML procedures for CASPs
Addressing Controversial Points
- Article 58 emphasizing the prohibition of anonymous accounts by CASPs
- Ban on exchanges offering services tied to privacy coins like Monero
Handling Transactions with Non-Custodial Wallets
Examining the critical aspects of the new EU anti-money laundering regulations concerning transactions involving non-custodial wallets.
Regulation Scope
- Rules applicable to transactions between obligated entities and non-custodial wallets
- Exemption for P2P transactions between non-custodial wallets
- Focus on registered and regulated entities, not software producers
Compliance Measures
- Requirement for VASPs to implement risk mitigation measures in transactions
- Collection of additional data on fund origin/destination including sender/recipient names
Updated Rules
- Revision of stringent KYC requirements for transactions to and from CASPs
- Removal of limits on transactions from non-custodial wallets exceeding €1,000
- Focusing on demonstrating the lawful origin of funds rather than imposing usage limits on non-custodial wallets
Hot Take: Stay Informed and Adapt
Stay proactive in understanding and complying with the evolving regulatory landscape in the cryptocurrency industry. Ensure you are informed about the latest updates to navigate the changing requirements effectively.
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