The EU continues the fight against money laundering and the financing of terrorism through cryptocurrencies

Photo - The EU continues the fight against money laundering and the financing of terrorism through cryptocurrencies
The use of cryptocurrencies in drug trafficking, money laundering, and terrorist financing is causing serious damage to their reputation. To regulate the sector more strictly, the EU has agreed on new rules to ensure transparency in the transfer of digital assets.
The regulation of cryptocurrencies is a topical subject for discussion in all countries. To stop the use of digital assets in criminal activities, representatives of the European Parliament and EU countries have reached a compromise regarding the rules of cryptocurrency transfers. During the negotiations, participants agreed to extend the rules concerning information specified in the remittance process while transferring digital assets.


Today we put order in the Wild West of crypto assets and set clear rules for a harmonised market.
said Stefan Berger, Member of the European Parliament.
Among the goals that the negotiating group faced were the fight against fraud, the transparency of the exchange of crypto assets, and the reduction of environmental impact. At the same time, compliance with strict international standards, including the FATF recommendations, was an essential condition.

What innovations await the cryptosphere in the EU?

On the evening of June 30, the Parliament and the Council concluded a preliminary agreement on new rules regarding digital assets – Markets in Crypto-assets (MiCA). According to the parties’ decision, MiCA will apply to digital assets that are not regulated by the legislation on financial services.
So, the agreement will affect BTC and ETH, but will not affect the NFT market. At the same time, officials do not exclude that in the future, they may be recognized as financial instruments that fall under the MiCA.
MiCA will ensure a harmonised market, provide legal certainty for crypto-asset issuers, guarantee a level playing field for service providers and ensure high standards for consumer protection.

Transparency of transfers

The new agreement requires the same obligations for payment service providers and crypto-asset service providers to collect and provide access to sender and recipient data. This will allow you to track cryptocurrency transfers and quickly respond to suspicious transactions.
According to the negotiators, such a decision plays a serious role in the fight against money laundering and the financing of terrorism. They emphasize that the agreement will adequately protect consumers and investors, as well as the financial integrity of the domestic market.
Due to the careful monitoring of transactions, it is planned to minimize the attempts of the sub-sanctioned individuals and legal entities to circumvent the restrictions. In addition, virtual asset service providers will have to implement comprehensive measures to reduce the risks of evading EU restrictive measures.

Creation of a public CASP registry

As part of the fight against money laundering and climate change, the European Securities and Markets Authority (ESMA) is to create a public register of large crypto asset services providers (CASP).
It will contain key information about CASP, including information about energy consumption, their impact on the environment and climate. In addition, providers are required to share this information with the national authorities of their country, which interact with ESMA.
The presented agreement is preliminary. In the future, it must be approved by the Committee on Economic and Monetary Affairs members. The MiCA is expected to start in 2024.