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Crypto-asset service providers (CASPs) will now be monitored by the government according&nbsp;to new laws passed by the European Parliament.
Approved on April 24, the&nbsp;<a target="_blank" href="https://www.europarl.europa.eu/news/en/press-room/20240419IPR20586/new-eu-rules-to-combat-money-laundering-adopted" rel="noopener noreferrer nofollow">new law</a>&nbsp;aims to improve “due diligence measures and identity checks” for consumers. The framework encompasses all entities operating in the jurisdiction and extends to CASPs.
Affected entities, such as cryptocurrency exchanges,&nbsp;will be required to&nbsp;flag and report suspicious activities to the government. The framework falls under the broader&nbsp;<a target="_blank" href="https://crypto.news/demystifying-eu-crypto-legislation-insights-from-former-icelandic-central-bank-chairman/" rel="noopener noreferrer nofollow">Markets in Crypto-Assets (MiCA) regulation</a>.&nbsp;
MiCA was developed by the European Commission last year and&nbsp;<a target="_blank" href="https://crypto.news/eu-finance-ministers-green-light-mica-crypto-regulation/" rel="noopener noreferrer nofollow">approved</a>&nbsp;in June 2023 to govern cryptocurrency assets within the European Union. The goal is to protect investors and maintain financial stability.
The new law also requires the creation of a new entity called the Authority for Anti-Money Laundering and Countering the Financing of Terrorism (AMLA). The supervising body,&nbsp;<a target="_blank" href="https://crypto.news/eu-picks-frankfurt-hq-anti-money-laundering-authority/" rel="noopener noreferrer nofollow">headquartered</a>&nbsp;in Frankfurt, Germany, will oversee the implementation of the new regulations.&nbsp;
EU strategy and policy director at Circle, Patrick Hansen, provided more clarity on the matter on X. He mentioned that CASPSs&nbsp;will be required to&nbsp;adhere to Know Your Customer (KYC) and Anti-Money Laundering (AML) procedures.
If CASPs abide by the above regulations, crypto users&nbsp;in the nation&nbsp;would be able to use these platforms “for buying goods &amp; services with crypto,” Hansen wrote. He added that this would only apply if the transaction value exceeds EUR 1000 (approx $1072).&nbsp;
This move could boost crypto-powered microtransactions in the EU, benefitting crypto payment companies like Strike, which recently&nbsp;<a target="_blank" href="https://crypto.news/bitcoin-centric-app-strike-enters-europe/" rel="noopener noreferrer nofollow">expanded</a>&nbsp;its services for European customers.&nbsp;
You might also like: <a href="https://crypto.news/europe-dominates-crypto-banking-with-63-providers/" rel="noopener noreferrer nofollow"> Europe dominates crypto banking with 63 providers </a>
However, the circle executive clarified that this requirement was already in place via existing regulations. All wallet providers and cryptocurrency exchanges operating in the nation&nbsp;are required to&nbsp;comply with these regulations.
“Previous versions of the proposed AMLR, proposed a way stricter approach that would have meant a KYC on the self-custody originator/beneficiary, but also thanks to industry efforts a risk-based approach with various options was finally agreed on,” he&nbsp;<a target="_blank" href="https://x.com/paddi_hansen/status/1771929879073771974" rel="noopener noreferrer nofollow">added</a>.
He&nbsp;<a href="https://x.com/paddi_hansen/status/1783204461571174437" target="_blank" rel="noopener noreferrer nofollow">noted</a>&nbsp;that the law would be officially adopted by the Council of the EU and will&nbsp;be enforced&nbsp;three years later.&nbsp;According to Hansen, the&nbsp;final version of the law&nbsp;is a “positive result” for the cryptocurrency sector, which&nbsp;largely&nbsp;operates in a&nbsp;<a href="https://crypto.news/europe-calls-on-non-eu-nations-to-tighten-crypto-regulation/" target="_blank" rel="noopener noreferrer nofollow">gray area</a>.
Read more: <a href="https://crypto.news/eu-securities-watchdog-10-exchanges-dominate-90-crypto-trades/" rel="noopener noreferrer nofollow"> EU securities watchdog: 10 exchanges dominate 90% crypto trades </a>

Crypto businesses in EU to conduct due diligence on customers

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