Europe wants to attract the crypto market more and more. The European Banking Authority (EBA) has announced new guidelines that apply to all crypto companies in Europe.
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Government and Regulation
European Banking Authority expands guidelines for crypto companies
The EBA is the European Union's banking regulator and announced the new guidelines in a press release on January 16th.
According to the new EBA guidelines, crypto companies in the EU are obliged to strictly comply with measures to combat money laundering and terrorist financing.
By expanding the existing measures, the EBA wants to introduce a uniform procedure for so-called Crypto-Asset Service Providers (CASPs) or crypto service providers.
According to the EBA, these service providers can be used to commit financial crimes. The banking regulator says the risks of money laundering and terrorist financing are increasing due to the high speed of crypto transactions. They also consider it risky that some products and platforms hide the user's identity.
The EBA therefore demands that European crypto companies become aware of these risks and take effective measures to counter them.
“The risks of this may be greater, for example due to the speed of transfer of crypto assets or because some products contain features that hide the user’s identity. Therefore, it is important that CASPs are aware of these risks and take steps to effectively mitigate them,” the press release states.
New crypto guidelines also apply to other financial institutions
The new guidelines also apply to other financial institutions that work with crypto service providers or are otherwise exposed to cryptocurrencies.
“Given the interdependence of the financial sector, the new guidelines also provide guidance for other credit and financial institutions that have CASPs as clients or are exposed to crypto assets,” the EBA said.
The relevant regulatory authorities in European countries must report within two months of publication whether crypto companies in their countries are complying with the new guidelines.
The new guidelines come into effect from December 30th. The new Crypto Assets Markets Act (MiCA) will also come into force around the same time.
Crypto Insiders recently reported that no fewer than 1,000 new crypto service providers would be added to Europe by 2023.
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