Ireland Now Requires Crypto Firms to Comply with AML Laws

Ireland is now requiring crypto companies to register with the central bank and comply with AML and counter-terrorism financing laws.

April 27, 2021 | AtoZ Markets Cryptocurrency companies in Ireland are coming under regulatory oversight for the first time, as domestic digital asset companies are now adhering to anti-money laundering guidelines set by the European Union (EU).

The European Union’s Fifth Anti-Money Laundering Directive (5AMLD), was converted into Irish law on April 23, through the Criminal Justice Law on Money Laundering and Terrorist Financing Amendment of 2021.

The legislation requires companies that operate with cryptocurrency assets, reserve portfolio providers – called virtual asset service providers (VASPs) – and companies that provide them with services, to adhere to the same regulatory standards as major financial firms.

Irish virtual asset service providers must now register with the Central Bank of Ireland for the next three months and conduct due diligence on their clients – including determining the origin and destination of their cryptocurrency assets, and reporting any suspicious financial activity.

The previous lack of regulation in Ireland had allowed traders to invest in crypto assets anonymously.

And this may only be the start of Irish cryptocurrency regulation, as all virtual asset service providers around the world serving European countries are expected to adhere to the European Union’s sixth anti-money laundering directive by June 3. The directive will require any of the virtual asset service providers with European clients to register with the European Union authorities and meet stringent reporting requirements.

In contrast to the European Union’s Fifth Anti-Money Laundering Directive, the updated guidelines give European authorities the power to punish companies and related legal entities, not just rogue employees. Virtual asset service providers that do not comply with the directive may face significant fines or lockdowns.

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