The EU has recently implemented a new directive that prohibits transactions using anonymous, privately managed crypto wallets for any transaction value. A representative from the European Parliament confirmed that the directive has been approved by the majority of the EU Parliament’s leadership committee.

This new regulation is aimed at combating money laundering by setting limits on cash transactions and banning all anonymous cryptocurrency transactions. Specifically, it makes any cash transaction over €10,000 and any anonymous cash transaction over €3,000 illegal.

The legislation focuses on transactions from private, unregistered crypto wallets to regulated service providers, limiting their use due to the anonymous and permissionless nature of cryptocurrency networks. Enhanced monitoring of cryptocurrency asset transfers is mandated, and crypto businesses are required to implement strict due diligence practices to prevent money laundering. Most entities in the cryptocurrency industry must adhere to these regulations, necessitating thorough customer background checks.

Moreover, the legislation stresses the importance of maintaining detailed records of actual beneficiaries to reveal the true owners or controllers of legal entities. This will require entities such as banks, real estate firms, and cryptocurrency businesses to enhance their customer verification processes.

These new EU regulations are significantly impacting how cryptocurrency is offered, managed, and traded in the region. For example, leading exchange OKX recently announced the delisting of USDT trading pairs in the region to comply with the rules imposed on stablecoins by the upcoming MiCA regulations.

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