Members of the European Parliament determined to fight money laundering will be looking into big crypto transactions alongside the metaverse, DeFi and NFTs.
The European Parliament is considering an overhaul of the EU money laundering laws proposed by the European Commission from last year, a draft bill seen by CoinDesk shows. The draft is couched as a set of “compromise amendments” to the law, designed to get consensus opinions among various political factions.
The European Parliament will be incorporating a left-wing lawmaker idea from earlier this year by including DeFi within the law’s scope.
The text says DeFi and the decentralized autonomous organizations governing it should also have to follow rules establishing control by the EU in some ways.
“Developers, owners or operators should assess risks of money laundering and terrorist assessments before launching or using a software or platform,” it added.
In addition, money laundering authorities have tried to outlaw the use of privacy-enhancing services like Tornado Cash over fears that such services will be used to process criminal money and prop up regimes like North Korea’s.
The plan would see a list of “obligated entities” covering banks, real estate agents and diamond traders, and would extend to wallet and crypto service providers regulated under the EU’s separate Markets in Crypto Assets Regulation (MiCA). Traders accepting crypto payments for goods and services worth over 1,000 euros, along with those trading or mining NFTs, may also be forced to check identities and report suspicious transactions.
The lawsuits could threaten those participating in the governance voting with liabilities.
The issue arose in a lawsuit against DeFi exchange developers bZeroX and its founders, which resulted in them taking a $250,000 settlement for not registering as Futures Commission Merchants and not enforcing various regulations such as KYC rules.
The agency had announced another lawsuit against the DAO running Ooki, which offers crypto lending, borrowing and margin trading for cryptocurrencies, which shocked the community, unraveling the presumption that governance token holders participating in votes managing the DAO aren’t responsible for its actions.
