Anonymous Crypto Assets Transactions Comes to an End as EU Parliament Adopts the New Anti-money Laundering Law
On Thursday March 31, 2022, the European Parliament's Committee on Economic and Monetary Affairs and Committee on Civil Liberties adopted the crypto asset anti-money laundering bill. The legislation got a majority vote of 93 members in its favor, 14 against it, with 14 members failing to appear at voting.
According to the new legislation, before all crypto-asset transactions occur, data on the asset source and who stands to benefit must be provided to the designated authorities. These rules also apply to the unhosted wallets where private users hold the wallet addresses. The new legislation recommends using technology solutions in the identification and traceability of individual asset transfers.
This law's primary objective is to ensure that all crypto transfers are traceable and no suspicious deal goes through, just like the traditional money transfer. However, the rules won't apply to transfers done from one person to another where a provider is not involved.
In the same meeting, the MEP agreed to do away with minimum thresholds and exemptions on low-value transfers. The decision was arrived at after the member states concluded that cryptocurrency transfers' virtual nature and speed often lead to the circumvention of threshold rules. The lawmakers scrapped the $1000 maximum threshold initially set, allowing every asset transacted to be traced.
The MEPs are advocating for the creation of public registers that enlist services and high-risk investments in crypto assets by the European Banking Authority (EBA). All the crypto providers must provide data proving that they're not associated with terrorism and money laundering. Before individuals send out assets from their wallets, they must share the recipient data.