BRUSSELS, Belgium—With potential regulation of cryptocurrency on the agenda in Congress, the European Union has created its first rules for tracing transfers of cryptoassets.
The rules, which are part of the E.U.’s new anti-money laundering measures, are intended to ensure that cryptoassets can be traced in the same way as traditional money transfers. They will be aligned with the E.U.’s Markets in Cryptoassets rules (MiCA) regulatory framework, legal firm Rahman Ravelli said in its analysis.
The agreement that has been reached extends the so-called “travel rule” that exists for traditional finance to cover transfers in cryptoassets. The rule requires that information on the source of the asset and its beneficiary travels with the transaction and is then stored on both sides of the transfer.
Cryptoasset services providers will have to provide this information to competent authorities if an investigation is conducted into money laundering and terrorist financing, Rahman Ravelli said.
No Minimum Thresholds
According to Rahman Ravelli, under the rules there are no minimum thresholds or exemptions for low-value transfers, as had been originally proposed. Before making cryptoassets available to beneficiaries, providers will have to verify that the source of the asset is not subject to restrictive measures or sanctions, and that there are no risks of money laundering or terrorism financing, Rahman Ravelli said.
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