- European Union approves anti-money laundering legislation to target anonymity in the crypto market.
- Threats pose by cryptocurrency to citizens and the financial sector was the major driver for this.
European Union: According to report from La Vanguardia – a local news channel – yesterday 14th May, the European Union has approved a new anti-money laundering (AML) legislation in a move to target anonymity in cryptocurrency transaction.
La Vanguardia revealed that the 28-member bloc has officially approved the new AML legislation, which the European Parliament had ratified in April. The new legislation will be released in the EU’s official journal and each member state would have 18 months to transfer these laws into its national legislation.
Federal authorities are against anonymity in cryptocurrencies transactions, as well as the use of some consumer banking products like prepaid cards. As soon as the AML legislation comes into effect, crypto exchanges, as well as other crypto-related entities, would have to adopt the guidelines, which would possibly comprise full customer verification.
At the time when the legislation was approved by the European Parliament, it was reported that the driving force behind the creation of the legislation was “threats to our citizens and the financial sector.”
It was further reported by MEP Krišjānis Kariņš that:
“This legislation helps address the threats to our citizens and the financial sector by allowing greater access to the information about the people behind firms and by tightening rules regulating virtual currencies and anonymous prepaid cards.”
The impact of the legislation on the cryptocurrency realm in nations under the control of the EU statutes would become evident later, though two crypto exchanges have pressed for stricter regulations.
BitPanda CEO, Eric Demuth, stated that formalization the cryptocurrency industry as much as possible would enable operators “know where they stand.”