The European Union (EU) is set to ban large transactions; involving crypto assets from anonymous self-hosted wallets as part of a broad anti-money laundering campaign.
Accordingly, the EU is expected to vote regarding the proposed regulations on March 28
New Anti-Money Laundering (AML) Rule?
The European Parliament Economics and Civil Liberties Committees revealed on March 14 that it is set to vote on the region’s anti-money laundering (AML) law. This move follows months of bickering on how to curb crypto and other blockchain-related use cases in committing financial crimes.
Based on the latest proposal, crypto traders will decline anonymous crypto transactions of over €1,000 or $1,080. In this case, the transaction can proceed if the services provider can identify the customer’s identity.
However, according to sources familiar with the latest development, the guideline’s initial draft was harsher. But reports revealed that the text was eased up on March 22 during an internal meeting between members of the European Council.
Furthermore, transactions between two individuals involving cryptocurrency, like large payments, would still be allowed to go through. The new legislation also bars businesses from accepting over €7,000 in hard currency and has created an agency to oversee money laundering in the region, the EU-anti money laundering agency (AMLA).
For the proposed draft to become law, the EU Parliament and the European Council are expected to agree to the measures put in place. Last year, the council reportedly sought to ban banks and crypto trading platforms from enabling transactions for privacy-based coins.
The move will likely put the likes of zCash, Dash, and Monero on par with other anonymous financial tools like bearer shares. Moreover, the EU parliament does not want to go to the extreme, but it has forbidden the operations of anonymous crypto wallets, along with privacy coins, as part of its anti-money laundering consideration.
No External Business Ties
Sources close to the latest development revealed that under the parliament plan, the EU has sought to ban crypto service providers from interacting with offshore digital asset firms that are not licensed in any jurisdiction. Furthermore, the proposal will also bring NFTs platforms under the scope of the EU money laundering guidelines and decentralized autonomous organizations (DAO) under their operators.
EU lawmakers have since last year been discussing how to stop money laundering through the metaverse, NFT, and decentralized finance (DeFI) platforms. In September 2022, members of the EU parliament reportedly explored how to checkmate the use of other digital ecosystems to launder funds by individuals and criminal entities.
The September draft, dubbed “Compromised Amendment,” is to find a consensus among the different regional entities by incorporating the EU’s laws on money laundering into the items. However, analysts noted that this represents an uncertain situation that the EU parliament must navigate before implementing the proposed rules.
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