While the European government is still working on its regulatory approach towards cryptocurrency regulation, a part of the body, which is the lawmakers, have earlier today published a new rule targeting crypto users with unverified identities.
The law which has just been passed wasn’t solely aimed at crypto specifically but at the act of money laundering or anonymously holding and transacting digital assets. The announcement read, “new EU measures against money laundering and terrorist financing.”
Limits Imposed On Unverified Crypto Users
Per a press release, the European Parliament and other lawmakers on the Economics and Civil Liberties committees on March 28 voted on new measures of anti-money laundering (AML) and terrorist financing regulation. Included in the new law was an imposed limit of €1000 on crypto users with unverified identities.
The press release noted:
Entities, such as banks, assets and crypto assets managers, real and virtual estate agents, and high-level professional football clubs, will be required to verify their customers’ identity, what they own, and who controls the company. They will also have to establish detailed types of risk of money laundering and terrorist financing in their sector of activity, and transmit the relevant information to a central register.
Besides the imposed $100 limit, the EU parliament also pressed €7000 on cash payments for transactions in the same category of unverified crypto users. These limits are part of the EU plan to revamp its AML regulations.
The limits come alongside the measures that restrict businesses from accepting large payments from anonymous sources.
According to Damien Carême, the French lawmaker leading the parliament’s negotiations on revamping its AML regulations, the law is not to ban crypto payments but to target money laundering as the limit cap only applies to unregulated wallets and unverified users. Carême noted:
We are absolutely not preventing crypto transactions. It’s just when identification isn’t possible.
EU Parliament Launches New Anti-Money Laundering Agency
With 99 lawmakers voting in favor of the new plan and six abstentions, the EU created a new European Union Anti-Money Laundering Agency (AMLA), which is permitted supervisory and investigative powers “to ensure compliance with AML/CFT requirements.”
The AMLA is responsible for monitoring risks and threats within and outside the EU. The agency would also be used to directly supervise some specific credit and financial institutions and classify them according to their risk level.
According to the report, the MEPs are looking to grant the AMLA the authority to mediate between national financial supervisors as well as the settlement of disputes. The AMLA will also receive whistleblower complaints and ensure stronger oversight of the supervisors in the non-financial sector.
Speaking of finance, the global cryptocurrency market has maintained composure despite the US financial sector suffering a crisis in recent weeks. Over the past 24 hours, the global crypto market is up by 1.5% at $1.188 trillion at the time of writing.
Featured image from Unsplash, Chart from TradingView