As the new EU crypto law comes into effect following the implementation of ‘Fifth Anti-Money Laundering Directive’ (AMLD5), the sector will receive a much-awaited push in the region. As per the new regulations, cryptocurrency businesses will be viewed as just any other business. Previously, crypto firms had to deal with separate regulations and oversight authorities.
The upcoming AMLD5 directives are sure to give a boost to the local crypto industry as less compliance is always good for business. AMLD5 became law in 2018 and was implemented this year on January 10. Virtual assets are classified as ‘obliged entities.’ Pawel Kuskowski of Forbes explains that such a classification categorizes the crypto businesses in the same league as gambling services, banks, the gaming industry, and payment processors. Crypto businesses will be viewed in the same light as other normal banking services.
New EU crypto law promotes mainstream crypto adoption
AMLD5 goes one step further when it comes to boosting positive crypto sentiment. It states that traditional banks refusing to work with crypto firms would have to provide a valid justification for their actions. They cannot simply say ‘no.’ The new EU crypto law will set a good precedent in the region as banks cannot force their hegemony on budding crypto firms. Most importantly, more people will be able to buy and sell virtual assets without having to worry about bank meddling.
That being said, AMLD5 is by no means a perfect standard. It is not crypto-centric. Neither does it promote cryptocurrency in any way. What it does is that it provides a level playing field for the crypto firms by providing adequate protection to conduct their business in the region. It will certainly help the firms assert their independence among the traditional sectors. Additionally, some concerns about anti-money laundering regulations have also been clarified in the AMLD5.
New EU crypto law further aims to explore and regulate the booming blockchain industry. The European Union is not promoting its development, but it is certainly not suffocating it either. In the new EU crypto law, it is providing fertile ground for the organic growth of the blockchain industry.
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