28 April 2021 12:35, UTC
Reading time: ~2 m
- Ireland is the latest European state to introduce the Fifth Anti-Money Laundering Directive (AMLD5).
- Cryptocurrency exchanges are required to register with the central bank within 90 days.
In a statement
released on Tuesday, the AMLD5 from the Financial Action Task Force (FATF) has been transposed into Irish law on Friday, April 23, 2021. The directive, now Irish law, forces virtual asset service providers (VASPs) to register with the Central bank of Ireland within the next three months and comply with all Know-Your-Customer (KYC) and Anti-Money Laundering (AML) laws.
The directive becomes part of financial laws in Ireland via the Criminal Justice (Money Laundering and Terrorist Financing) Amendment Act 2021.
The report describes VASPs
as firms that facilitate the exchange between virtual assets and fiat currencies, an exchange between one or more forms of virtual assets, custodian wallet provider, transfer of virtual assets between digital addresses, and any other activities involving transacting virtual assets.
This starts a new regime in Ireland whereby crypto exchanges must record and keep their users’ KYC/AML information– effectively killing anonymous crypto transactions
. As per the guidelines, VASPs operating in the country must comply with these laws or “it will be a criminal offense,” which could result in a fine, imprisonment, or both.
Additionally, VASPs are required to perform due diligence on their clients to find the origin of their funds, destination of transactions and report any suspicious activities to authorities.
As reported last May, the Irish cryptocurrency service providers found it difficult to conduct their business as local banks locked them out as the government delayed implementing the AMLD5
. With the new laws, a few crypto companies are looking to restore their partnerships with local banks.
Netherlands became the first European country to charter a cryptocurrency exchange under the new AMLD5 laws in late October 2020. Nederlandsche Bank NV (DNB), the Netherlands' central bank, approved AMDAX BV
as the first digital asset firm to operate under its jurisdiction allowing users to buy and sell crypto through the exchange.