Financial Crime

European Central Bank and Council of the European Union

Transfers of cryptoassets - ECB Opinion and Council mandate on traceability requirements published - 30 November 2021

The European Central Bank (ECB) has published an Opinion (CON/2021/37) welcoming the initiative of the European Commission to extend traceability requirements to cryptoassets by means of a proposed Regulation on information accompanying transfers of funds and certain cryptoassets. The proposed Regulation forms part of the Anti-Money Laundering/Countering Financing of Terrorism (AML/CFT) package adopted by the European Commission in July 2020.   

The ECB affirms that cryptoasset transfers are subject to similar money laundering and terrorism financing risks as wire transfers of funds, and so cryptoasset service providers should be subject to the same level of AML/CFT requirements as other entities. The ECB puts forward a number of amendments to the proposed Regulation, and suggests that:

• it should be made clear that the Regulation is not intended to cover cryptoassets issued by central banks acting in their monetary authority capacity;
• the proposed Regulation should use the term, “official currencies” rather than “fiat currencies” when referring to the currencies of Member States that have not adopted the Euro; and
• the date of application of the proposed Regulation should be aligned with that of the proposed Regulation on Markets in Crypto-Assets (MiCA).

In parallel, the Council of the European Union (the Council) has announced that EU ambassadors have agreed on a mandate to negotiate with the European Parliament on the proposed Regulation, and has published an “I” item note to this effect. The modifications introduced by the Council in its position streamline and clarify the Commission’s original proposal, in particular by introducing requirements for cryptoasset transfers between cryptoasset service providers and un-hosted wallets. The proposal also requires that the full set of originator information travels with the cryptoasset transfer, regardless of the transaction amount.

The Council invites the Presidency to start negotiations with the Parliament, with a view to reaching an agreement at first reading.

Opinion of the European Central Bank of 30 November 2021 on a proposal for a regulation to extend traceability requirements to transfers of crypto-assets (CON/2021/37)

Council of the European Union: Press release: Anti-money laundering

“I” item note: Proposal for a Regulation of the European Parliament and of the Council on information accompanying transfer of funds and certain crypto-assets (recast) (14257/21)