Anti-money laundering: European Council adopts rules which will make crypto-asset transfers traceable

The EU is making it more difficult for criminals to circumvent anti-money laundering rules via crypto currencies. Recently the Council adopted updated rules on information accompanying the transfers of funds by extending the scope of the rules to transfers of crypto assets. 

This ensures financial transparency on exchanges in crypto-assets and provides the EU with a solid framework that complies with the most demanding international standards on the exchange of crypto-assets, ensuring that these are not used for criminal purposes.

Council’s decision is bad news for those who have misused crypto-assets for their illegal activities, to circumvent EU sanctions or to finance terrorism and war. Doing so will no longer be possible in Europe without exposure – it is an important step forward in the fight against money laundering.

Under the new rules, crypto asset service providers are obliged to collect and make accessible certain information about the sender and beneficiary of the transfers of crypto assets they operate, regardless of the amount of crypto assets being transacted. This ensures the traceability of crypto-asset transfers in order to be able to better identify possible suspicious transactions and block them.

This regulation is part of a package of legislative proposals to strengthen the EU's anti-money laundering and countering terrorism financing (AML/CFT) rules, presented by the Commission on 20 July 2021. The package also includes a proposal to create a new EU authority to fight money laundering.

The Council agreed its position on the transfer of funds proposal on 1 December 2021. Trilogue negotiations started on 28 April 2022 and ended in a provisional agreement on 29 June. The recent formal adoption is the final step in the legislative process. (consilium.europa.eu/ photo: freepik.com)

Read the Regulation on information accompanying transfers of funds and certain crypto-assets (recast)

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Editorial

Editorial
George Kazoleas, Lawyer

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