With the anonymity associated with the crypto industry, a feature many have argued aids criminal transactions, the EU is making efforts to stop the misuse of cryptocurrencies.
The European Union through its three organs plans to form a sixth Anti-Money Laundering Authority that is tasked with regulating the crypto industry.
The European Commission, the European Council, and the European Parliament are working together to fashion out a dedicated regulatory body for the sector. This body will be responsible for regulating the sectors whose recent meltdown wiped out several billions of investors’ funds.
Back in July 2021, the European Commission published its proposal for the AMLD6, one year later, the European Council disclosed its version. Upon resumption from the current August break, the European Parliament will also discuss its version of the legislation.
Afterward, the three bodies will begin a deliberation process referred to as trilogue. Each organ will present its version before the three bodies jointly agree and propose a final draft for implementation.
The timeline for this implementation depends on the outcome between the member countries’ parliament and the resolve of trilogues.
While a date has not been fixed yet, it is clear that a stiffer regulation for the industry is in the works as there’s a minimal disagreement between the three bodies. Unlike other anti-money regulations that provide regulations for the broader financial industry, AMLA will oversee high-risk crypto service providers.
The newly finalized Markets in Crypto Asset (MiCA) and Transfer of Funds are not limited to only crypto but all financial institutions. AMLD6 framework on the other hand will concentrate on the crypto industry. Many other countries who do not have the resources to draw up their own rules from scratch can adopt that of the EU and amend them to their taste.
Recently, the European Parliament supported anti-anonymity regulations that make transactions between unhosted wallets and exchanges difficult.
Although a recent move to ban Proof-of-Work (PoW) mining was unsuccessful, the regulators still believe that the ban will eventually take place owing to its effects on the environment.
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