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Author Topic: 5th Anti-Money Laundering Directive: Key Requirements for Cryptocurrencies  (Read 36 times)
LoonaJRV
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September 07, 2018, 08:48:19 AM
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Under upcoming 5MLD cryptocurrencies and cryptocurrency exchanges are considered “obliged entities”, and face the same CFT/AML regulations applied to financial institutions under 4MLD. Practically, this involves an obligation to perform customer due diligence (CDD), and submit suspicious activity reports (SAR).

Read more what are the other requirements under 5th Anti-Money Laundering Directive: https://complyadvantage.com/blog/5mld-fifth-anti-money-laundering-directive/

Do you think 5MLDs regulation of crypto-exchanges will encourage or discourage the mass adoption of virtual currencies?
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September 07, 2018, 11:58:25 AM
 #2

Under upcoming 5MLD cryptocurrencies and cryptocurrency exchanges are considered “obliged entities”, and face the same CFT/AML regulations applied to financial institutions under 4MLD. Practically, this involves an obligation to perform customer due diligence (CDD), and submit suspicious activity reports (SAR).

Read more what are the other requirements under 5th Anti-Money Laundering Directive: https://complyadvantage.com/blog/5mld-fifth-anti-money-laundering-directive/

Do you think 5MLDs regulation of crypto-exchanges will encourage or discourage the mass adoption of virtual currencies?

Reading through the provisions of this policy, the implementation when it comes to effect in 2020 will be hard to ignore because some provisions are there, that would more or less unravel the anonymity behind the use of crypto and any crypto entirely. Its a big step forward towards the eradication of anonymous transactions. For those who don't have anything to hide or have nothing to do with suspicious activities, they might not have any problem while those who are conscious of their privacy even though they don't have any link to terrorist activities, they might have to start considering other options. Some of the provisions include for those who are lazy to read up

Quote
Prepaid cards issued outside the EU are now prohibited unless they were issued in a territory enforcing legislation equivalent to the EU’s AML/CFT and KYC standards. Obliged entities must review the way they handle prepaid card payments, and put mechanisms in place to identify (and refuse) transactions using cards from non-EU sources – which may involve significant revision of existing systems and procedures.
Also a limit on transactions 5MLD sets an even lower limit of €150 – this limit also applies to the amount which can be stored on the cards. Similarly, online transaction limits are reduced to €50.

For those in countries without adequate data, you are also taken care of

Quote
Companies dealing with customers from high-risk third countries will be required to perform enhanced due diligence measures – specifically focused on addressing the risk posed by deficiencies in those countries’ AML protections. The measures include:

Obtaining information on customers and UBO – including the reasons for proposed transactions, and details on the source of UBO funding and wealth.
Reporting transaction details to senior management – and obtaining approval for establishing or continuing the business relationship.
Increasing controls on business relationships, and selecting transactions which may need further scrutiny.

Source: https://complyadvantage.com/blog/5mld-fifth-anti-money-laundering-directive/

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September 07, 2018, 08:34:05 PM
 #3

If anything, the EU's AMLDs have generally helped, rather than stifle money businesses. Sure, it costs businesses more and more just to keep complying or upgrading requirements but they're actually all fairly easy to comply with, and to acquire licences for, after an initial period of feeling around. Anyway, it's usually in the best interest of regulators and their economies to help businesses comply quicker (and they know this).

You're only in trouble if you intended to do naughty things, though I suppose this will always isolate those keen to preserve privacy. Will they help mainstream adoption? Perhaps. Will they encourage the "proper" use of Bitcoin and the rights of the individual to anonymity? Nope.

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