European Union Finalizes Crypto Money Laundering Rules
- However, the European Union law excludes transfers from unhosted private wallets from laundering investigations.
In spite of the growing concerns by industries, the European Union has finally decided to adopt an anti-money laundering law geared towards guiding crypto transactions. The union unanimously approved the law after a robust discussion in Brussels on Wednesday.
As revealed, the new rules stressed the need for robust verification of customer identity on all crypto transfers between two regulated virtual wallet service providers. However, the European Union law excludes transfers from unhosted private wallets from laundering investigations.
The EU economic bloc has in the past few months engaged in a series of meetings geared towards carving out a political deal on the proposal. According to reports, the landmark anti-money laundering bill was introduced by the European Commission in July 2021.
Now, one of the lawmakers present at the Brussel meeting, Ondrej Kovarik in a tweet confirmed the approval of the bill. According to the lawmaker, the new rules give the appropriate balance in subduing the risks incurred in checking money laundering, particularly in the crypto space.
Kovarik noted that such efforts will be put into action without abating innovations or distracting industries. He further states that the bill possesses potential benefits to aid the growth of the crypto industry in Europe.
European Union Focus on Crypto Assets
About a few months ago, the European lawmakers decided to widen the coverage of the proposal. They intend to incorporate provisions recognizing transactions with unhosted virtual wallets in the bill. As designed, unhosted wallets are manned by a highly regulated service provider.
Then, the lawmakers wanted the reportage of all the transaction details of these wallets to authorities. As observed, this intended plan by the lawmakers was greeted with a series of protests, particularly by industry actors.
The players alleged that the incorporation of such a proposal into the bill tends to jeopardize privacy and innovation in crypto industries.
Renowned crypto firms, like Coinbase, lobby unions, and some legal experts condemned the move by lawmakers, stressing that such tends to unlawfully promote privacy breaches. Amid the outcries by these industry players, the union held talks to determine the rules which will align with the interest of the European Parliament and the Council of the EU.
A Wednesday tweet by Kovarik, however, clarifies the final decision of the union on the proposed incorporation of unhosted wallet transactions in the bill. According to the lawmaker, the union resolved that unhosted wallets will now be applicable only when transfers are done to someone’s private wallet. More so, he said the application of the provisions of the bill as regards hosted wallets will only be enforceable if the transferred asset is beyond 1,000 euros.
A well-known member of the European Green Party, Ernest Urtasun also hinted in a tweet that the rules tend to put an end to the era of unregulated crypto operations. According to Urtasun, the law will help address the weaknesses enveloped in the European anti-money rules.
He hinted that the law caters to the recording and verification of customer identity. However, the newly approved law still needs to be translated into legislative text and gazetted in the official journal of the European Union.
Rebecca is a Senior Staff Writer at BitcoinWisdom, working hard to bring you the latest breaking news in the cryptocurrency market. In the words of Elon Musk “Buy stock in several companies that make products & services that *you* believe in. Only sell if you think their products & services are trending worse. Don’t panic when the market does. This will serve you well in the long-term.”
