EU Members Want to Task New AML Watchdog With Crypto Oversight, Report Unveils

EU Members Want to Task New AML Watchdog With Crypto Oversight, Report Unveils

A group of EU nations have reportedly been lobbying to entrust oversight of the crypto space to a new anti-money laundering (AML) agency. Behind the move are concerns that companies dealing with digital assets can be engaged in the processing of illicit funds. Germany Leads Push to Place Crypto Firms Under EU Anti-Money Laundering Supervision

Several EU member states, led by Germany, have been urging the European Union to grant a planned anti-money laundering (AML) watchdog powers to oversee businesses in the crypto sector. Quoting knowledgeable sources, Bloomberg revealed these nations fear cryptocurrency companies can be used to process illegally obtained funds.

EU authorities, such as the European Commission (EC), are now negotiating over the design of the regulatory body, expected to launch in 2024 and expand its operations in the next two years. Said group is seeking to ensure a more explicit inclusion of crypto firms in the watchdog’s responsibilities, according to an EU diplomat who, like the other sources for the article, chose to remain anonymous.

The European Union is preparing to establish the new agency after a series of scandals in recent years which exposed gaps in the bloc’s regulatory framework allowing flows of dirty money. Meanwhile, the booming crypto market has opened a new front for law enforcement as the anonymity associated with digital assets is allegedly attracting criminals and rogue states.

Spain, Austria, Italy, Luxembourg, and the Netherlands are among the nations rallying behind Germany in the initiative. They insist that the new European watchdog’s remit should cover the riskiest cross-border entities among banks, other financial institutions, and crypto service providers, the diplomat unveiled. The EC’s proposal from July 2021 only indirectly refers to “virtual assets.”

The executive body has declined to comment and member states are yet to discuss the idea. The quoted officials remarked that it’s still unclear whether the changes are going to win wide support. Besides, the European Parliament will have the final say on the legal texts. A leading EU lawmaker for the proposal, Luis Garicano, stated: It is key that the scope of the new EU authority explicitly includes crypto assets, given that this is one of the fields more prone to money laundering activities.

At present, national authorities are responsible for combating money laundering in the EU, which limits their effectiveness and raises questions about their independence. Europe’s financial system has been involved in several major scandals in the past decade, including the laundering of Russian money through Danske Bank’s Baltic operations and Latvia’s ABLV Bank.

According to the blockchain forensics company Chainalysis, illicit transactions have spiked by 80% to an all-time high of $14 billion last year. Yet crime-related flows still represent a small share of all crypto transaction volume which has also seen a serious increase in 2021. Tags in this story AML, anti-money laundering, Authority, EC, EP, EU, Europe, european commission, European Parliament, European Union, Germany, Group, Money Laundering, Oversight, proposal, Proposals, regulator, regulatory body, watchdog

Do you think other EU member states will support the initiative of the German-led group? Let us know in the comments section below. Lubomir Tassev

Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration. Canadian Regulator Alerts Police to Tweets by Coinbase and Kraken Advocating Non-Custodial Wallets REGULATION | 7 hours ago Grayscale Investments Asks Investors to Help Convince SEC to Approve Bitcoin Spot ETF REGULATION | 1 day ago

Image Credits: Shutterstock, Pixabay, Wiki Commons Previous articleDe-Mixing Wasabi Coinjoin Transactions: A Deep Dive Into Chainalysis’ Deanonymizing Claims Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. Read disclaimerShow comments More Popular NewsIn Case You Missed ItMcDonald’s Trademark Filings Hint at Fast Food Giant"s Intent to Produce Metaverse Restaurants

Following a slew of well known brands filing trademarks for metaverse related products and virtual goods, the American fast food firm founded in 1940, McDonald’s, has filed for ten trademark applications that describe plans to offer virtual restaurants and other ... read more.Binance Invests $200 Million Into the Business Magazine and Digital Publisher Forbes JPMorgan Predicts Long-Term Bitcoin Price of $150K — Outlines Challenges Ahead Fitch Ratings Downgrades El Salvador Deeper Into Junk Status Citing Bitcoin Risks US Inflation Jumps to 7.5%, CPI Climbs at Fastest Rate in 40 Years, Citizens See Little Wage Growth