The European Parliament has approved new legislation that limits anonymous crypto transfers to 1000 euros. The three new draft bills include the EU single rulebook, which guides the use of anonymous instruments like crypto assets, and the 6th Anti-Money Laundering Directive to ensure access by authorities to reliable information. The third text deals with establishing a bloc-wide Anti-Money Laundering Authority used in the upcoming Markets-in-Crypto-Assets bill.
Under the new law, crypto asset managers must identify their customers’ identities, assets, and ownership and send information about associated money laundering and terrorist financing risks to a central register. Anonymous crypto transfers must be limited to 1000 euros.
Each EU member-state must establish a financial intelligence unit to combat money laundering and terrorist financing. The lawmakers voted to establish a new supervisory and investigative money laundering authority to supervise entities with a high residual risk. The Anti Money Laundering Authority must directly supervise the riskiest crypto asset service providers operating in the 27-member EU bloc for the first time.
Members of Parliament also favor tracking ownership of high-value assets like yachts, airplanes, and motor vehicles worth over 200,000 euros. A plenary sitting of the European Parliament will start negotiations on the bills in April 2023.
The three newly-adopted texts will likely complement the upcoming Markets-in-Crypto-Assets bill. The MiCA bill introduces a new legislative framework for cryptocurrency businesses, including a licensing scheme and compulsory disclosures.
Under MiCA, every transaction involving a crypto asset service provider registered in the EU must comply with the Travel Rule, irrespective of the amount transferred. EU member state France already applies this rule. CASPs must send originator and beneficiary information to the AMLA described in the second adopted text. The type and volume of information depend on the amount transferred and whether the CASP suspects foul play. They must ask a self-custodial wallet user who transfers more than 1000 euros if he is the wallet’s owner.
The sentiment coming from the industry is that it wants an effective regulatory regime. The new MiCA bill provides industry participants within the EU a grace period. U.S. regulators could use MiCA to draft an American crypto playbook.
