New EU KYC/AML Rules to Impose Stricter Surveillance Measures on Users and Service Providers

The European Council and Parliament reached a provisional agreement that would cover 'most of crypto sector' and would require firms to conduct even more surveillance on their customers.

New EU KYC/AML Rules to Impose Stricter Surveillance Measures on Users and Service Providers
  • "The provisional agreement expands the list of obliged entities to new bodies. The new rules will cover most of the crypto sector, forcing all crypto-asset service providers (CASPs) to conduct due diligence on their customers. This means that they will have to verify facts and information about their customers, as well as report suspicious activity," was stated in a press release.
"According to the agreement, CASPs will need to apply customer due diligence measures when carrying out transactions amounting to €1000 or more."
  • The agreement also adds "measures to mitigate risks in relation to transactions with self-hosted wallets." While it's not mentioned what these measures will eventually entail, politicians drafting the law have been mentioning "a limit of 1,000 euros (US$1,080) for payments made from self-hosted wallets where it isn’t possible to identify the payer."
  • The new KYC/AML regime would also impose "an EU-wide maximum limit of €10.000 is set for cash payments, which will make it harder for criminals to launder dirty money. Member states will have the flexibility to impose a lower maximum limit if they wish."
"In addition, according to the provisional agreement, obliged entities will need to identify and verify the identity of a person who carries out an occasional transaction in cash between €3.000 and €10.000."
  • "The texts will now be finalized and presented to member states’ representatives in the Committee of permanent representatives and the European Parliament for approval. If approved, the Council and the Parliament will have to formally adopt the texts before they are published in the EU’s Official Journal and enter into force,” the statement added.
  • On Tuesday, the European Banking Authority also extended its guidelines on money laundering and terrorist financing risk factors to Bitcoin and crypto sector.

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