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EU drafts crypto transfer rules to fight money laundering

Members of the European Parliament (MEP) have adopted draft legislation strengthening EU rules against money laundering and terrorist financing with MEPs set to negotiate the final shape of the legislation with EU governments. The parliament will vote on it during its plenary session in April.

Ernest Urtasun MEP says: “Criminals thrive where rules allowing for confidentiality allow for secrecy and anonymity. With this proposal for a regulation, the EU will close this loophole.”

Under the new rules, cryptoasset transfers will, much like traditional money transfers, have to include information on their source and the beneficiary, including transactions from private user digital wallets.

Before making a cryptoasset available to beneficiaries, providers such as crypto exchanges would have to verify that the source of the asset is not subject to restrictive measures and that there are no risks of money laundering or terrorism financing.

The rules would not apply to person-to-person transfers or among exchanges and providers acting on their own behalf.

“Technological solutions should ensure that these asset transfers can be individually identified,” the parliament says.

MEPs have also decided to remove minimum thresholds and exemptions for low-value transfers and want the European Banking Authority (EBA) to set up a public register of crypto firms that may have a high risk of money-laundering, terrorist financing and other criminal activities.

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