Members of the European Parliament approved three draft bills ramping up regulations around crypto transactions. The legislation deals with money laundering and terrorism financing and is not directly targeted at digital assets. However, once it’s signed into law, it will affect the industry by limiting anonymous transfers to just 1,000 euro.
The package in question includes three bills:
- the so-called EU “single rulebook” detailing rules of performing due diligence on customers, handling transparency of beneficial owners (disclosing the identity of the ultimate owner controlling an entity through a web of other entities), and dealing with “the use of anonymous instruments, such as crypto assets,”
- the 6th anti-money laundering directive ensuring authorities access to “necessary and reliable information,” for example, on “assets stored in free zones,”
- the draft establishing the European Anti-Money Laundering Authority (AMLA) for ensuring compliance with AML/CFT (combating the financing of terrorism) regulations.
New transaction limits: €7,000 for cash, €1,000 for crypto
According to the provisions contained in the drafts, banks, cryptocurrency companies, real and virtual estate agents, and some other types of enterprises will have to conduct a check-up on their customers’ identity and assets. The regulations also put a cap on transactions. The limit has been set to €7,000 for cash and €1,000 ($1,087 at the time of writing) for anonymous cryptocurrency transfers.
“The new European watchdog will monitor emerging problems related to money laundering in the financial system. For us, it is important the new authority cooperates very closely with national supervisors and that it directly supervises the riskiest crypto assets service providers and companies in the financial sector that operate in several member states for the first time,” Emil Radev, co-rapporteur for the Anti-Money Laundering Authority, said in a statement.
All the drafts had significant backing. 99 MEPs voted in favor of the “single book,” with 8 against and 6 abstentions. The second bill “scored,” respectively, 107, 5, 0, and the latter 102, 11, 2. The negotiations on the final shape of the bills will start at a plenary session of the European Parliament in April.
New regulations likely to be incorporated in the MiCA bill
The new regulations will complement the long-debated Markets in Crypto-assets rules (MiCA) bill – a sweeping 400-page legislation for digital assets that is slowly taking shape as a new legal framework for crypto businesses across the European Union.
MiCA introduces very detailed rules and limitations that have stirred the industry and may have a profound effect on crypto operations on the old continent.