European Banking Authority suggests revamping anti-money laundering and counter-terrorism financing regulations for cryptocurrency providers.
The European Banking Authority (EBA), an EU agency responsible for implementing banking regulations across the EU, has released a consultation paper highlighting the inadequacy of current regulations for Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) standards compliance in the crypto industry. The EBA is inviting interested parties to provide comments on the paper until Feb. 26.
The paper proposes measures to improve the detection of missing or incomplete information on the payer or payee. The EBA suggests repealing the 2017 Joint European Supervisory Authorities (ESAs) Guidelines under Article 25 of Regulation (EU) 2015/847 in order to streamline procedures and better manage fund transfers that lack essential information within the regulatory framework.
In section four of the consultation paper, titled “Preventing the Abuse of Funds and Certain Crypto-Assets Transfers,” Crypto Asset Service Providers (CASPs) will be required to obtain and maintain information on self-hosted addresses. Additionally, CASPs will need to ensure individual identification of crypto asset transfers and verify ownership or control of the address by the CASP customer. These requirements will apply when the transfer amount from a self-hosted account exceeds 1,000 euros, although the EBA does not specify whether this threshold is on a monthly, daily, or one-time basis.
This development comes just two months after European lawmakers endorsed the DAC8 directive, which empowers tax authorities to oversee and regulate cryptocurrency transactions across the EU. These actions represent significant steps towards comprehensive monitoring of transactions conducted within the region, potentially setting a precedent for the broader crypto industry.
