The EU Council and Parliament reach a provisional deal on the Anti-Money Laundering Regulation, which will force all crypto companies to run user due diligence
🚫Prohibition of cash payments over €10,000 — 🆔Prohibition of anonymous cash payments over €3,000 — https://www.consilium.europa.eu/ ... This #waroncash is going to take its toll! #negativeinterestrates #accountblocking https://www.patrick-breyer.de/ ... … Dare Obasanjo / @carnage4life@mas.to : The EU is on track to pass a law requiring all crypto firms to do due diligence on their customers to prevent money laundering. — This is bad news given money laundering is one of the few places crypto found product-market fit besides pyramid schemes. — https://www.coindesk.com/... X: EU Council / @eucouncil : 🚨The Council & @Europarl_EN reached a provisional agreement on new anti money laundering rules to close loopholes used by criminals to launder dirty money through the financial system. How does money laundering work? What will the new rules bring? Find out more 👇 @europarl_en : MEPs have finalised a deal with the Council on new measures to beef up an EU toolkit to fight money laundering, terrorist financing and sanctions evasion. Find out more: https://europa.eu/!Krtm78 [image]
Context & Ripple Effects
The provisional agreement extends an EU policy arc that had already moved crypto transfers toward verified identities for regulated-wallet transfers and considered KYC requirements for even small transactions involving unhosted wallets.
It matters because customer due diligence is being positioned as a baseline obligation for crypto businesses within a wider anti-money-laundering regime that also curbs high-value and anonymous cash use.
First-order effects
- Crypto companies covered by the regulation will need customer-due-diligence processes, making identity and risk checks a core compliance function rather than a limited transfer-specific control.
- Users seeking to transact through those firms face less scope for anonymous access, while the EU’s AML framework gains a more consistent data trail across crypto providers.
Second-order effects
- Providers will have to compete on compliance execution as well as product features, likely increasing demand for identity verification, transaction monitoring, and case-management services.
- Businesses that cannot absorb the operational burden may narrow offerings or reassess EU exposure, contributing to the earlier shift toward verified crypto transfers.
Third-order effects
- If implementation is consistent, EU crypto market access will increasingly be tied to regulated identity, moving the sector closer to the compliance model applied to conventional financial intermediaries.
- The measure is another instance of the EU’s push against anonymous crypto activity, with the eventual effect on market structure depending on how broadly obligations are applied and enforced.
The trend: Crypto regulation is converging on a model in which access to regulated liquidity depends on identity verification and ongoing financial-crime controls.