EU Tightens Crypto Compliance Rules Starting This Month

The EU’s Anti-Money Laundering Authority (AMLA) has issued a warning to crypto exchanges and service providers about stricter compliance requirements starting this month. The new regulations mandate that regulators must assess the beneficial owners and shareholders of crypto companies to ensure they are not involved in money laundering or terrorist financing. This move is part of a broader effort to enhance the EU's financial integrity and protect the bloc from the risks associated with cryptocurrencies.

The AMLA, which became operational at the start of the month, is tasked with ensuring that the EU’s 27 countries comply with its sweeping new set of anti-money laundering regulations. The authority's chair, Bruna Szego, emphasized the importance of assessing the beneficial owners of crypto asset service providers, including their shareholders and their locations. This assessment is crucial to ensure that these entities are not involved in illicit activities.

Szego also highlighted the risks specific to the European crypto market, such as inconsistent controls between different EU countries and a fragmented market where multiple companies are seeking regulatory approval under the Markets in Crypto-Assets (MiCA) regulation. She noted the risks of diverging applications of rules between national authorities, which could create loopholes for financial crimes.

Under the new AML regulations, cryptocurrency service providers will be prohibited from providing or interacting with anonymous wallets and privacy coins. Additionally, virtual asset service platforms (VASPs) will be required to provide direct, immediate, and unfiltered access to crypto-asset account data to government agencies. These rules will come into full effect by July 2027, marking a significant shift in the EU's approach to regulating the crypto industry.

The AMLA's warnings come at a critical time for the crypto sector, which has faced numerous anti-money laundering probes. For instance, Binance was fined €3.3 million by the Netherlands’ central bank for failing to follow its AML registration process in July 2022. French authorities also opened an anti-money laundering probe into the firm in January 2025 amid suspicions of terrorist financing, including drug trafficking and tax fraud.

The EU's new regulations reflect a growing recognition of the potential risks associated with cryptocurrencies and the need for robust oversight. By mandating direct government access to account data and prohibiting anonymous wallets and privacy coins, the EU aims to enhance transparency and accountability within the crypto industry. This approach is designed to protect investors and maintain the integrity of the financial system while allowing the crypto industry to continue to grow and evolve.

The AMLA's warnings serve as a reminder to crypto firms of the importance of compliance and the need to adapt to evolving regulatory landscapes. As the EU continues to refine its approach to cryptocurrencies, firms in the sector will need to stay vigilant and proactive in their efforts to meet regulatory requirements. The new regulations represent a significant shift in the EU's approach to crypto, reflecting a growing recognition of the sector's potential risks and the need for robust oversight.