The European Union has enacted a fresh directive that prohibits the use of anonymous, privately operated crypto wallets for any transaction amount. This directive gained approval from the majority of the EU Parliament's leadership committee recently, signaling a significant step in combating money laundering within the region.

The new regulation focuses on restricting cash transactions and eliminating all forms of anonymous cryptocurrency transactions. It specifically deems any cash transaction exceeding €10,000 and any anonymous cash transaction over €3,000 as unlawful under this directive.

EU Regulations on Crypto Transactions

The legislation targets transactions originating from private, unregistered crypto wallets towards regulated service providers, effectively curbing their usage due to the inherent anonymity and decentralized nature of cryptocurrency networks. Enhanced monitoring of cryptocurrency transfers is mandated, with crypto businesses required to implement stringent due diligence measures to prevent money laundering activities.

The directive emphasizes the need for thorough monitoring of cryptocurrency asset transfers and necessitates crypto entities to conduct comprehensive customer background checks. The focus is on revealing the true owners or controllers of legal entities, compelling various entities such as banks, real estate firms, and cryptocurrency businesses to enhance their customer verification protocols.

These new regulations are reshaping the landscape of crypto operations within the EU region, impacting how cryptocurrencies are offered, managed, and traded. Notably, OKX, a prominent exchange, recently announced the removal of USDT trading pairs in compliance with regulations governing stablecoins like those outlined in the upcoming MiCA regulations.