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After his statement in May that declared cryptocurrencies as a risky investment, the Vice President of ECB has now called for crypto to be subject to the same rules as other assets.
Luis de Guindos, the European Central Bank’s (ECB) Vice President, has stated that he is not looking to ban cryptocurrencies but instead wants to highlight the significance of establishing rules within the emergent industry to combat financial crimes.
As reported by myconomy, the ECB believes strict measures should be introduced to prevent the use of cryptocurrencies in suspicious and illicit activities.
On May 19, he stated that #cryptocurrencies aren’t real investments due to the fragility of their #value proposition. https://t.co/HqAbx2N5L0
— Bitcoin News (@BTCTN) August 30, 2021
De Guindos stated, “I would not prohibit them, but issuers must be required to follow the same conditions as those of other financial assets and avoid everything that has to do with money laundering or terrorist financing.”
He further added that cryptocurrencies will “have no impact on financial stability.”
The ECB’s statement follows the footsteps of the new AML proposal introduced by the European Commission. According to this proposal, all types of crypto-assets must fall under the EU’s AML/CFT standards. This includes the implementation of Know Your Customer procedures, similar to what traditional financial institutions follow.
“The aim of this package is to improve the detection of suspicious transactions and activities, and to close loopholes used by criminals to launder illicit proceeds or finance terrorist activities through the financial system.”, says the European Commission.
Additionally, the traceability of cryptocurrency transactions would be strengthened, as crypto would be treated the same way as bank transfers. The proposal has also suggested banning anonymous cryptocurrency wallets and the formation of a new Anti-Money Laundering Authority (AMLA) within the EU for the close monitoring of the cryptocurrency sector.
Suggested Read: The EU’s New AML Proposal, What’s in Store?