Ireland is taking swift action to draft new cryptocurrency regulations in anticipation of stricter European Union (EU) Anti-Money Laundering (AML) and terrorist financing laws set to take effect at the end of December 2024. The country’s Finance Minister, Jack Chambers, has emphasized the urgency of drafting the new laws to align with these upcoming EU standards before they come into force.
EU AML and Countering Terrorism Financing Act
The EU’s Anti-Money Laundering and Countering the Financing of Terrorism Act (AML/CFT) will strengthen the powers of financial intelligence units and grant them the authority to suspend transactions that appear suspicious. One of the key provisions of this new legislation is the introduction of more stringent reporting requirements for cryptocurrency exchanges, including limits on cash payments (set at €10,000 or about $10,850). The new rules will also require greater scrutiny of high-value transactions, including enhanced monitoring and reporting.
In addition to its focus on cryptocurrencies, the AML/CFT framework covers areas like crowdfunding and other potential risks in the financial system, aligning with the Markets in Crypto-Assets Regulation (MiCA) introduced by the European Commission.
Ireland’s Response and Regulatory Push
Given the December 30 deadline for the new EU laws, Ireland is working to introduce national-level crypto legislation that will align with the EU’s directives. Though the Irish government has not disclosed specific details regarding the content of the legislation, Minister Chambers has emphasized the need to act quickly.
Ireland has long been a key player in the European financial ecosystem, and Derville Rowland, Deputy Governor of the Central Bank of Ireland, highlighted the country’s goal of being at the forefront of safe and responsible innovation in the crypto sector. As part of this commitment, Ireland aims to be a leader in adapting to new technologies while ensuring that its financial systems are safeguarded from illegal activities, including money laundering and terrorist financing.
Impact of EU MiCA Regulations
Along with the AML/CFT act, the Markets in Crypto-Assets Regulation (MiCA), which came into effect in June 2023, will complement the new anti-money laundering rules. MiCA is the EU’s comprehensive regulation designed to establish a uniform framework for the crypto sector, addressing consumer protection, market integrity, and financial stability within the European Union.
These combined regulations will create more robust oversight over crypto transactions, making it harder for illicit activities to thrive in the crypto space.
Ireland’s Role in the Crypto Sector
In preparation for these legislative changes, the Central Bank of Ireland has already approved 15 virtual asset service providers (VASPs) as of July, including notable firms like Gemini, Ripple, Paysafe, MoonPay, and Coinbase. However, some crypto platforms, including Coinbase, have had to delist non-compliant stablecoins from their European platforms to meet the requirements of the upcoming EU regulations.
While specific details about the Irish government’s forthcoming crypto regulations remain scarce, the efforts to update and align Ireland’s laws with EU-wide standards underscore the country’s intent to balance regulatory oversight with the promotion of technological innovation in the digital assets space.
Conclusion
With the EU’s updated Anti-Money Laundering and terrorist financing laws coming into effect at the end of 2024, Ireland’s rapid push to draft new crypto regulations reflects the nation’s desire to maintain its standing as a leading financial hub in the EU. These steps are part of a broader European effort to ensure that the crypto industry operates transparently and securely, while mitigating the risks of illegal activities in the sector.
