Weekly SmartPills #1
EU ANTI-MONEY LAUNDERING
Key Provisions of the New EU Anti-Money Laundering Regulation
The EU Commission for Economic Affairs has voted in favor of the new anti-money laundering regulation, with 99 votes in favor, 8 against, and 6 abstentions. Although the new regulation does not fall under MiCA (the new European regulation on cryptocurrencies), it aims to address certain regulatory gaps. The new regulation focuses on NFT platforms, DeFi, and DAOs, requiring them to comply with the regulations in place for CeFi companies.
The new law requires platforms to identify and verify customers (CASPs) with a due diligence procedure for all transactions to unhosted wallets. The threshold for customer identification on exchanges is set to zero.
The commercial sector is also affected by new restrictions that impose rules on merchants accepting cryptocurrency payments. All purchases of goods and services in cryptocurrency worth more than €1000 from an unhosted wallet will be authorized only if the owner or beneficiary can be identified. The new regulation prohibits business relations with CASPs not included in the official list and bans relations with platforms lacking registration and/or a license.
The European Anti-Money Laundering Authority (AMLA) will have the power to create a list of platforms considered high risk and operating outside the EU, forming an actual blacklist. NFT trading platforms will be under the spotlight of the anti-money laundering unit and will now be subject to legal obligations in the fight against money laundering and terrorism financing.
Potential Impact on the Crypto Industry and Innovation
This new regulation could have an impact on technological innovation and the growing cryptocurrency industry. While EU regulations such as MiCA and the new anti-money laundering directive may facilitate engagement with the industry by ensuring legal clarity across bureaucracies, there are concerns that this may slow down development, creating a bottleneck effect. However, the regulation is still under approval, and the European Parliament and Commission must reach a final agreement by April 17.