EU lawmakers to extend Anti-Money Laundering rules to NFTs

EU lawmakers to extend Anti-Money Laundering rules to NFTs

Several governments have rolled out policies aimed at checkmating the activities in the crypto space. Members of the European Union parliament have proposed new changes to the Anti-Money Laundering (AML) law to include NFT trading platforms.

The amendment is a part of the “Preventing abuse of the financial system for money laundering or terrorism purposes,” a larger package of proposals submitted by European lawmakers.

The proposal was put forward by the Green Party’s Ernest Urtasun of Spain and Denmark’s Kira Marie Peter-Hansen, alongside socialist lawmakers, France’s Aurore Lalucq and Csaba Molnár of Hungary.

If the amendment is fully implemented into the final version of the AML bill, NFT platforms would become “obliged entities” under EU money laundering law.

According to the proposal, the four MPs want the EU to extend the legislation’s coverage to “crypto-asset service providers, trading or acting as intermediaries for importing, minting, sale and purchase of unique and not fungible crypto-assets that represent ownership of a unique digital or physical asset, including works of art, real estate, digital collectibles and gaming items and any other valuable.”

The EU already has a complex legislative process, which can end with provisional agreements on the draft legislation by European institutions. These agreements start as informal but must be formally approved by the Parliament, the Council of the European Union, and the European Commission.

Meanwhile, this week, the European Central Bank is expected to warn eurozone countries of the potential dangers of national regulators making decisions before the designed EU crypto asset rules are introduced.

This development follows the European Parliament and the Council of the European Union’s decision to reach a provisional agreement on the Transfer of Funds Regulation (TFR) to ensure that crypto transfers can be traced and transactions considered as suspicious blocked, making way for tougher enforcement by the EU.

The bill also highlights Brussels’ supervision over 'unhosted wallets' in what many industry representatives refer to as a suicide measure that could hinder the sector’s development across Europe.

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