Germany-Led Group Wants a New EU Watchdog to Regulate Crypto Firms
The European Union is planning to dote its planned anti-money laundering and terrorist financing watchdog with powers related to oversight over cryptoasset businesses, according to "people familiar with the matter." The designed authority is to be launched in 2024 and become fully operational two years later.
As part of the ongoing discussions on relevant legislation, Germany is leading a group of states that want to make the inclusion of crypto companies within the watchdog’s scope of activities more explicit, an EU diplomat is cited by Bloomberg as saying.
In addition to Germany, other countries that are part of the group include Austria, Italy, Luxembourg, Spain, and The Netherlands.
The six member states seek to cover crypto asset service providers with the activities of the designed watchdog, which is to be named the Authority for Anti-Money Laundering and Countering the Financing of Terrorism (AMLA).
Meanwhile, the European Commission’s proposal, which Brussels released last July, refers briefly to “virtual assets.”
“The competences of the Authority in the area of virtual assets are coherent with the Digital Finance Package published by the Commission on 24 September 2020,” according to the proposal.
The modifications to the legislation put forward by the group are yet to be formally discussed by the bloc’s member states, with the European Parliament playing a role in the process.
“It is key that the scope of the new EU authority explicitly includes crypto-assets, given that this is one of the fields more prone to money laundering activities,” said Luis Garicano, an EU lawmaker for Spain’s liberal Ciudadanos (Citizens) party.
Meanwhile, adding to the ongoing discussions, Jesse Powell, CEO of crypto exchange Kraken, and Sam Bankman-Fried, CEO of crypto exchange FTX, in a recent discussion on Twitter exchanged their perspectives on the state of relations between regulators and their businesses.
Bankman-Fried tweeted relations between the crypto industry and regulators were "not great" "for a long time," and that "the negative interactions and frustrations way outweighed the productive discussions," leading to, among other things, "a really negative impression" of crypto in Washington. "But things are starting to change, at least in the US,” he stated.
This statement has provoked a reaction by Powell who commented that he could "understand why newbie 2019 entrant might have this perspective," adding "no offense." He argued that:
"Us crypto boomers who have been working with lawmakers, regulators and law enforcement since <2011 have a different perspective: we've been cooperating, working very hard to pave the way all along."
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