Crypto-assets: new rules to stop illegal flows in the EU
On 31 March 2022, Members of the European Parliament from the Committee on Economic and Monetary Affairs (ECON) and Committee on Civil Liberties, Justice and Home Affairs (LIBE) adopted, with 93 votes (to 14 votes against and 14 abstentions) their position on a proposal for legislation strengthening the EU rules on combating money laundering and terrorist financing.
According to the MEPs, transfers of crypto-assets should be traced and identified to prevent their use in money laundering, terrorist financing, and other crimes.
The main proposals include traceability of transfers of crypto-assets, abolition of minimum thresholds and exemptions for low-value transfers, and keeping a public register of high-risk entities.
- Traceability of transfers of crypto-assets
Considering the new requirements agreed by the MEPs, all transfers of crypto-assets will have to contain information on the source of the asset and its beneficiary. Such information will be made available to competent authorities. The new rules will also cover transactions from so-called unhosted wallets (a crypto-asset wallet address that is in the custody of a private user).
Such measures aim to ensure that transfers of crypto-assets can be traced and suspicious transactions blocked. The rules would not apply to transfers between persons executed without a provider (such as bitcoins trading platforms), or between providers acting on their own behalf.
- No minimum thresholds
One of the proposals adopted by the MEPs is to remove minimum thresholds and exemptions for low-value transfers. It should be noted that due to their speed and virtual nature, crypto-assets transactions easily circumvent the rules based on transaction thresholds.
- Public register of high-risk entities
Another plan is for the European Banking Authority (EBA) to create a public register of enterprises and services related to crypto-assets which might be associated with high risk of money laundering, terrorist financing and other criminal activities.
