The European Commission intends to tighten anti-money laundering and counter-financing of terrorism rules by banning anonymous crypto asset wallets as it seeks to align European Union law with Financial Action Task Force standards, according to legislative proposals presented yesterday.

Fast facts

  • A key change is a proposed amendment to the 2015 EU regulation on transfers of funds (Regulation 2015/847) to extend its scope to the crypto sector. This means that senders’ and beneficiaries’ information will have to be provided by virtual asset service providers for crypto transfers, as payment service providers do for wire transfers. “Providing anonymous crypto asset wallets will be prohibited, just as anonymous bank accounts are already prohibited by EU AML/CFT rules,” the commission said.
  • “The rationale is the same as for the original regulation on funds: to identity those who send and receive crypto-assets for AML/CFT purposes, identify possible suspicious transactions and if necessary block them,” a Q&A document said.
  • Another proposal was the creation of a new EU-level central authority — the Anti-Money Laundering Authority — to coordinate and support AML/CFT supervision across the EU.
  • An EU-wide limit of €10,000 (US$11,800) for large cash payments was also proposed to make it more difficult to launder large sums of money.
  • The legislative proposals will need to be approved by the European Parliament and Council before they come into effect. The plan is for AMLA to be established in 2023 and start most of its activities in 2024.

See related article: FATF: Most countries have yet to implement anti-terrorism crypto ‘travel rule’