{"id":414670,"date":"2022-03-11T11:44:18","date_gmt":"2022-03-11T08:44:18","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/consolidation-and-centralization-how-europes-new-aml-regulation-will-affect-crypto\/"},"modified":"2022-03-11T11:44:18","modified_gmt":"2022-03-11T08:44:18","slug":"consolidation-and-centralization-how-europes-new-aml-regulation-will-affect-crypto","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/consolidation-and-centralization-how-europes-new-aml-regulation-will-affect-crypto\/","title":{"rendered":"# Consolidation and centralization: How Europe\u2019s new AML regulation will affect crypto"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a35781503095\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a35781503095\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/consolidation-and-centralization-how-europes-new-aml-regulation-will-affect-crypto\/#%E2%80%9D_Consolidation_and_centralization_How_Europes_new_AML_regulation_will_affect_crypto_%E2%80%9C\" >&#8221; Consolidation and centralization: How Europe\u2019s new AML regulation will affect crypto  &#8220;<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/consolidation-and-centralization-how-europes-new-aml-regulation-will-affect-crypto\/#The_watchdogs_mandate\" >The watchdog\u2019s mandate<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/consolidation-and-centralization-how-europes-new-aml-regulation-will-affect-crypto\/#Governed_by_directives\" >Governed by directives<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/buradabiliyorum.com\/en\/consolidation-and-centralization-how-europes-new-aml-regulation-will-affect-crypto\/#Changes_to_the_regulatory_landscape\" >Changes to the regulatory landscape<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/buradabiliyorum.com\/en\/consolidation-and-centralization-how-europes-new-aml-regulation-will-affect-crypto\/#The_hardline_scenario\" >The hardline scenario<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h1><span class=\"ez-toc-section\" id=\"%E2%80%9D_Consolidation_and_centralization_How_Europes_new_AML_regulation_will_affect_crypto_%E2%80%9C\"><\/span>&#8221; Consolidation and centralization: How Europe\u2019s new AML regulation will affect crypto  &#8220;<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<p><img decoding=\"async\" src=\"https:\/\/images.cointelegraph.com\/images\/840_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjItMDMvMzMxZGNkOWItYjQwZC00NTJkLTk2MzItNDQzOTllMTVjMzdiLmpwZw==.jpg\" \/><\/p>\n<div class=\"post-content\" data-v-128018ef>According to recent <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">media<\/a> reports, six European countries, led by Germany, are working on launching an Anti-Money Laundering (AML) body that will include the cryptocurrency market in its purview. Details remain scarce, but it is known that the initiative involves Germany, Spain, Austria, Italy, Luxembourg and the Netherlands. The group is working on \u201cthe remit and design\u201d of a new international AML watchdog force that will have a particular emphasis on crypto, and the European Commission \u2014 the key executive institution of the European Union \u2014 will be the primary platform for the discussion. How will the move affect the European crypto space?<\/p>\n<h3><span class=\"ez-toc-section\" id=\"The_watchdogs_mandate\"><\/span>The watchdog\u2019s mandate<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The new task force will aim to \u201ccover the riskiest cross-border entities among banks, financial institutions and crypto assets service providers.\u201d At the moment, the initiative still awaits official deliberation. Christian Toms, a partner in law firm Brown Rudnick\u2019s litigation and arbitration practice group in London, noted to Cointelegraph: <\/p>\n<blockquote><p>\u201cNegotiations very much remain ongoing around its remit, and as part of these negotiations \u2014 presumably given the growing awareness of the uses of and risks around crypto \u2014 there are understood to be specific discussions taking place about making the agency\u2019s role in regulating crypto and related institutions a key part of its mandate, potentially even spelling out such matters in its foundational principles.\u201d<\/p><\/blockquote>\n<p>This isn\u2019t the first time the media has speculated on the idea of an EU crypto task force. In July 2021, Reuters \u2014 citing leaked documents \u2014 reported that the European Commission had proposed a new Anti-Money Laundering Authority, which would become the \u201ccenterpiece\u201d of the whole European crypto oversight architecture. The mentioned plans also included new requirements for virtual asset service providers in accordance with the EU\u2019s strict data collection standards. <\/p>\n<h3><span class=\"ez-toc-section\" id=\"Governed_by_directives\"><\/span>Governed by directives <span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>A common critique of United States crypto regulation is that it relies on a mishmash of agencies such as the Securities and Exchange Commission, Commodity Futures Trading Commission, Financial Crimes Enforcement Network and many others. Europe, though, also does not have a single authority in charge \u2014 there is only a patchwork of various national agencies, many of which expertise in matters of the digital economy. This makes creating a centralized watchdog more of a necessity than a hostile move.<\/p>\n<p>The current absence of such a body stems from the fact that the EU\u2019s AML rules are established by directives, which are pieces of legislation that are not automatically mandatory and instead need to be transposed by each member state into their national laws. Thibault Verbiest, head of the fintech and crypto finance department at law firm Metalaw, explained to Cointelegraph: <\/p>\n<blockquote><p>\u201cAlthough the 5th Anti-Money Laundering Directive, which entered into force on January 10, 2020 and since has been fully transposed by almost all member states, includes within its scope crypto service providers (notably, exchanges and custodian wallet providers) as obliged entities, [&#8230;] the absence of a pan-EU authority imposes to rely on each national regulator to enforce AML rules.\u201d<\/p><\/blockquote>\n<p>The current state of European AML enforcement came under harsh criticism several years ago when separate national-level investigations proved that over 200 billion euros<a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.reuters.com\/article\/us-danske-bank-moneylaundering-explainer-idUSKCN1NO10D\"> (about $227 billion at the time) of non-resident money flowed<\/a> through the Estonian branch of Denmark\u2019s largest bank between 2007 and 2015. <\/p>\n<h3><span class=\"ez-toc-section\" id=\"Changes_to_the_regulatory_landscape\"><\/span>Changes to the regulatory landscape<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>With the arrival of the new enforcement power, we might witness a rapid centralization (and clarification) of the EU crypto framework. That could downplay the competitive advantage of certain conspicuously friendly jurisdictions, as, in Verbiest\u2019s opinion, the differences in rules transposition, interpretation and enforcement will be ironed out. It will be more difficult, if not impossible, for an EU member state to have a stance different from the others:<\/p>\n<blockquote><p>\u201cThe monitoring activities and Anti-Money Laundering\/Counter-Terrorist Financing rules across the EU will be uniformized up and consolidated. [&#8230;] With stricter reporting requirements to come and better cooperation between member states on AML\/CFT subjects, regulators wish to establish the best possible m<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>ing of crypto transactions so as to identify transactions that pertain to illicit activities as well as limit the erosion of the taxable base.\u201d<\/p><\/blockquote>\n<p>The major trend of rapid regulatory consolidation is here to stay as the money laundering issue (not necessarily related to crypto) remains highly relevant. According to Toms, AML rules and regulations are already being tightened up in <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/general\/\" data-internallinksmanager029f6b8e52c=\"3\" title=\"General\" target=\"_blank\" rel=\"noopener\">general<\/a> with each new iteration of EU regulations as the battle against dirty money intensifies: <\/p>\n<blockquote><p>\u201cThe current conflict in Ukraine and the sanctions against Russia may prove to be a further catalyst for tighter regulation across the board if there is a fear certain parties may now be even more actively seeking to find more and more novel ways to circumvent AML regulation. [&#8230;] Crypto, which has already been in the EU\u2019s alarmed sight for a while, may very well find itself caught up in the situation.\u201d <\/p><\/blockquote>\n<h3><span class=\"ez-toc-section\" id=\"The_hardline_scenario\"><\/span>The hardline scenario<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Another major factor is the development of central bank and state-issued digital currency projects, which could affect the regulatory and oversight climate and would be hardly optimistic for the crypto industry. If this movement picks up steam across Europe, \u201cunregulated\u201d crypto companies and currencies could become increasingly marginalized and viewed as a route taken by those who, for some reason, don\u2019t want to use state-authorized CBDCs.<\/p>\n<p>Such a dark scenario is far from guaranteed, however, given the increasing adoption of crypto at the retail and institutional levels and with more and more of the big names in finance becoming involved with it somehow. <\/p>\n<p>At the end of the day, Europe, where executive decision-making is arguably less burdened with parliamentary pressure than in the U.S., may come up with a tougher stance on crypto. The EU will likely seek to take an increasingly hard line in regulating criminal conduct and consumer protection, and crypto is still viewed with suspicion.<\/p>\n<p>But the <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/game\/\" data-internallinksmanager029f6b8e52c=\"7\" title=\"Game\" target=\"_blank\" rel=\"noopener\">game<\/a> is not one-sided: After all, the crypto industry will have to figure out how to manage issues of transparency and Know Your Customer in a decentralized world.<\/p>\n<p><template data-name=\"subscription_form\" data-type=\"law_decoded\"><\/template><\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/consolidation-and-centralization-how-europe-s-new-aml-regulation-will-affect-crypto\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8221; Consolidation and centralization: How Europe\u2019s new AML regulation will affect crypto &#8220; According to recent media reports, six European countries, led by Germany, are working on launching an Anti-Money Laundering (AML) body that will include the cryptocurrency market in its purview. Details remain scarce, but it is known that the initiative involves Germany, Spain,&#8230;<\/p>\n","protected":false},"author":1,"featured_media":414671,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/images\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjItMDMvMzMxZGNkOWItYjQwZC00NTJkLTk2MzItNDQzOTllMTVjMzdiLmpwZw==.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74859,74858,28340,72705,43905,55229,33897,70934],"class_list":["post-414670","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-aml","tag-bitcoin-regulation","tag-europe","tag-european-union","tag-germany","tag-law","tag-money-laundering","tag-regulation"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/414670","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=414670"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/414670\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/414671"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=414670"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=414670"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=414670"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}