The head of the Anti-Money Laundering Authority (AMLA), Bruna Sego, warned that a mass migration of users after the MiCA transition period could overwhelm crypto services in the European Union, as stated in a statement.
According to her, departing crypto service providers (VASP) in the EU risk facing a mass withdrawal of client funds, while licensed companies may experience a sudden influx of new users. In both scenarios, this will increase the burden on customer verification processes and compliance with AML requirements.
New EU Crypto Regulations
The MiCA transition period ended on July 1. Before this date, firms could operate in the EU under national licenses if they began their activities before December 30, 2024. Now, registration under the new regulations is required to provide services.
As of the end of the transition period, the register of the European Securities and Markets Authority (ESMA) included 244 licensed crypto service providers in the EU and EEA. In the final days before the deadline, companies from Italy, France, Malta, and Spain joined the list. On July 6, the fintech project Ripple received full MiCA authorization.
Previously, ESMA demanded that companies without permission immediately cease operations in the region. The regulator also launched a program to inspect crypto asset service providers (CASP), with a particular focus on custodial services.
Next Steps for AMLA
On the eve of the transition period's end, AMLA released an advisory note with recommendations for crypto companies. The document outlines measures for firms exiting the EU market and licensed VASPs accepting new clients.
By the end of the year, the regulator plans to publish a report on money laundering threats in the crypto industry and the practices for monitoring crypto service providers in EU countries. The agency is also enhancing its blockchain analytics capabilities.
According to Sego, the findings of the study will help AMLA coordinate efforts with national regulators and develop a unified approach to monitoring crypto services in the EU.
It is worth noting that in July, the European Parliament approved an official position on further regulation of digital assets, which includes expanding oversight of DeFi, NFTs, staking, and crypto lending.