EU tightens crypto regulatory measures; approves bill to track crypto-assets’ flow

  • This bill would force crypto asset service providers (CASPs) to request customer data on all transactions and give it to authorities when they request it.
  • Several crypto companies protested against the bill’s proposal in April, citing a violation of user privacy and safety.

On June 29, the EU Parliament and Council members reached an agreement on a new bill. The EU can monitor crypto-asset transactions through this new bill, including bitcoin transactions. However, the EU notes that the bill is an extension of the current “travel value” policy, which is applicable in the traditional finance sector.

The EU claims that the purpose of the new bill is to prevent possible fraudulent transactions, which is common in the crypto space. Part of the official statement reads;

the bill makes it mandatory that details of the sender of a crypto asset and the receiver are contained in the transaction details. Also, they must be displayed on either side of the transaction. When necessary, crypto-asset service providers will be mandated to provide these transaction details to the appropriate authorities. Such necessary cases might include investigation of transactions suspected to be for money laundering or terrorist financing.

Stricter policy measures for the crypto space

This new bill is one way the EU attempts to prevent all possible loopholes against anti-money laundering activities. According to the EU, current crypto transactions violate existing thresholds. However, the Parliament participants explained that it slightly modified the earlier proposal for this bill. Unlike the proposed bill, this new bill will not allow minimum thresholds. Also, there will be no exemptions for low-value transfers.

However, crypto market players like Coinbase have expressed their displeasure over this new EU crypto rule Coinbase argued that this bill will only encourage several low-value crypto transactions. That won’t be favorable for the crypto market due to the fast growth in its adoption rate. Two months ago, over 40 crypto firms wrote a protest letter to EU finance ministers regarding this bill, even though it was still at the proposal stage.

The exchange also argued that sharing user data violates customers’ privacy rights. Then, it added that sharing user data for low-value transactions is not feasible. Regarding the bill’s section for CASPs to request for name and crypto address for each crypto transaction, the participants said, “if either party doesn’t agree to uphold the privacy rule, then the transaction shouldn’t take place.”

Related: Coinbase calls on the public to oppose the EU’s amendment to the “Transfer of Funds Regulation”

The EU policymakers added that senders must confirm that the receiving party has no restrictive sanctions or measures before sending crypto assets to such receivers. Also, the sender must be sure that the receiver won’t use the funds for illegal purposes such as financing terrorism or money laundering.

Once there is a transaction that exceeds 1,000 euros between unhosted and hosted wallets, CASPs must take certain steps. They must have the customer for each sender and receiver readily available. Any regulatory body may request the data at any time. Also, they must verify that the customer is the authentic owner or controller of the un-hosted wallet.


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Paul is a cryptocurrency enthusiast from Canada, and since 2021 he has been writing about cryptocurrency for online news portals. He writes mostly news-related articles. Stay tuned to his posts to stay up to date with the crypto world.

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