See More

New European AML Regulations Look Set to Impact Cryptocurrency

2 mins
Updated by Adam James
Join our Trading Community on Telegram
New anti-money laundering (AML) regulations are coming into force by January 10 in Europe. The rules, which address cryptocurrency companies for the first time, look set to have a large impact on the industry.
The Fifth Anti-Money Laundering Directive (5AMLD) is set to take full effect in less than a month. It was first detailed in May last year. The rules, for the first time, define what is meant by the term virtual currency:
”… a digital representation of value that is not issued or guaranteed by a central bank or a public authority.”
The incoming regulations will require those offering custodial services for virtual currencies to abide by the AML regulations laid down under 4AMLD. This will mean that exchange platforms offering services within the European Union will need to submit information about customers to relevant authorities and to perform due diligence checks on user activity deemed suspicious. This is set to have a dramatic impact on the industry. As reporter Larry Cermak (@lawmaster) points out, the likes of Binance and OKEx, two absolute giants of the exchange industry, will suddenly have to follow the new regulations or cease offering services to Europe. Binance, one of the most consistently popular exchanges thanks to its high withdrawal limits without requiring know-your-customer checks, would need to overhaul its own policies. It currently allows users to withdraw two BTC without any KYC check. This is clearly not compliant with AML regulations and would need addressing. Alternatively, it might decide to withdraw its services entirely from the EU. Faced with heightened regulatory pressure from some jurisdictions, Binance has already proved that it is willing to compromise to continue offering its services to key global markets. Earlier this year, as BeInCrypto reported, the platform suddenly withdrew from the US before launching Binance US — a much-reduced but regulatory-compliant platform for American users. Some businesses have already shut down, citing the incoming regulatory measures. BottlePay, for example, stated last week that the new regulations would make it impossible to continue offering its social media tipping service in a way consistent with its current operation. Rather than compromise, the business announced that it would cease operating at the end of the year, via a press release. Other businesses, such as Simplecoin and Chopcoin, have also made similar announcements. European Central Bank Although the incoming regulations will certainly shake up the way European cryptocurrency companies operate, some seem to be embracing the change. A representative of the EXMO digital asset trading platform, Valeriya Kolomiychenko, wrote in a Medium post that the new rules would provide greater certainty — something that many businesses serving the space have been eager for in recent years.
Top crypto projects in the US | July 2024
Harambe AI Harambe AI Explore
Uphold Uphold Explore
Exodus Exodus Explore
Coinbase Coinbase Explore
Chain GPT Chain GPT Explore
Top crypto projects in the US | July 2024
Harambe AI Harambe AI Explore
Uphold Uphold Explore
Exodus Exodus Explore
Coinbase Coinbase Explore
Chain GPT Chain GPT Explore
Top crypto projects in the US | July 2024

Trusted

Disclaimer

In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

c8d670c5ace3fefdd9c2b09519d3b3c7?s=120&d=mm&r=g
A former professional gambler, Rick first found Bitcoin in 2013 whilst researching alternative payment methods to use at online casinos. After transitioning to writing full-time in 2016, he put a growing passion for Bitcoin to work for him. He has since written for a number of digital asset publications.
READ FULL BIO
Sponsored
Sponsored