Ireland cryptocurrency-focused companies are now obliged to comply with Anti-Money Laundering (AML) and Know Your Customer (KYC) requirements
Ireland’s crypto-focused companies are now obligated to comply with the Anti-Money Laundering (AML) and Know Your Customer (KYC) requirements, according to the Bank of Ireland.
The 5th anti-money laundering directive of the EU has been turned into law in Ireland
According to a press release from the Central Bank of Ireland, crypto companies operating in the country will now need to register with the central bank for a period of three months with the newly enacted legislation.
Also, virtual asset services providers (VASPs) will have to comply with the same know-your-customer (KYC), anti-money laundering (AML), and counter-terrorism financings (CTF) requirements like banks and other financial institutions. In addition, VASP is defined as any company that provides an exchange service between cryptocurrencies and fiat money or two cryptocurrencies, as well as custodians and other financial services related to cryptocurrency.
Until now, traders – to a certain extent – could still buy and sell cryptocurrencies anonymously in Ireland. With the change in monitoring rules, VASPs will be required to perform due diligence to their clients, including identifying, calculating the origin and destination of transactions, and reporting suspicious financial activity.
As directed by the regulator, failure to comply with obligations is an offense, and failure to do so could result in a fine, imprisonment, or both.
Crypto companies may be forced to close
There have been instances of crypto companies shutting down in other countries, including the UK, the Netherlands, and France – all due to new rules that make their business unprofitable. The same is likely to happen in Ireland.
Jed Grant, CEO of KYC3, an automation service provider for alternative investment and crypto finance, said:
“New rules will force companies to leave and go to jurisdictions where there’s not so much control. Companies will be forced to innovate and build non-custodial solutions where they don’t actually hold any of the cryptos.”
The EU 5AMLD came into effect in July 2018, with European authorities allowing member states until January 2020 to apply their AML and CFT rules in line with the rest of the Union.
However, some countries, including Ireland, have been slow to incorporate directives into their national legislation. And this caused the European Court of Justice to fine Ireland 2 million Euros ($ 2.42 million) for the delay.
EU member states are likely to see stricter cryptocurrency regulations, with a deadline of June 3 to comply with the Sixth Anti-Money Laundering Directive (6AMLD). The 6AMLD builds on previous AML directives and lists 22 crimes, including cybercrime, insider trading, and market manipulation, with harsher penalties expected.
Read more:
- Taiwan Has Enacted Anti-Money Laundering Regulations For Cryptocurrency Exchanges Effective July 1
- Indonesia’s Commodity Futures Trade Regulatory Agency Considering Levying A Tax On All Cryptocurrency Transactions