European Union launches rules on cryptocurrencies to prevent money laundering

The European Parliament has approved new legislation that imposes strict investigative obligations on cryptocurrency companies. The objective is to combat money laundering and ensure greater security in digital markets.

The new rules target cryptocurrency service companies (CASPs), such as centralized exchanges, under the Markets in Cryptoassets Regulation (MiCA). The regulation, promulgated in June 2023, will come into force until the end of 2024.

MiCA establishes a comprehensive regulatory framework to oversee digital assets and their markets. As part of the implementation of these measures, a new agency, the Anti-Money Laundering and Terrorist Financing Authority (AMLA), will be established in Frankfurt, Germany.

Patrick Hansen, director of EU policy and strategy at Circle, highlighted the importance of these regulations. According to Hansen, cryptocurrency companies will now be required to follow standard Know Your Customer (KYC) and Anti-Money Laundering (AML) procedures.

These measures, while not new to cryptocurrency exchanges and wallet providers, represent a significant step in standardizing and strengthening security in digital markets.

Combating money laundering with cryptocurrencies

Meanwhile, in Spain, Rodrigo Buenaventura, president of the National Securities Market Commission (CNMV), warned about the risks associated with cryptocurrencies, even with regulation. As he emphasized, these assets remain extremely risky and not recommended for ordinary investors.

Despite efforts to regulate the sector, Buenaventura highlighted that investor protection is significantly lower compared to other financial instruments. He urged Spanish society to remain aware of the risks associated with cryptocurrencies, highlighting the importance of investor education.

Meanwhile, the Mica Law, although it has not yet boosted euro cryptocurrency transactions, is seen as having potential when it is fully implemented in 2024. The European Securities and Markets Authority (ESMA) noted that while the euro plays a minor role in cryptocurrency transactions, regulation can increase investor protection and positively influence the market.

However, the significant concentration of transactions on a few platforms and the growing popularity of stablecoins raise questions about the diversification and stability of crypto markets. As the market continues to evolve, questions about regulation, security and stability remain at the center of discussions.