The European Union will set a new limit on cash purchases and tighten controls on cryptocurrency transactions. On November 6, the bloc agreed to set a 10,000-euro limit on cash payments and to more strictly supervise cryptocurrency transactions above 1,000 euros.
The European Union will limit the use of cash, ostensibly to combat money laundering.
EU countries have announced a series of new guidelines aimed at making it more difficult to use cash and other alternative currencies such as cryptocurrencies for criminal purposes. On November 6, the bloc approved a new limit on cash payments, which will allow up to €10,000 in all countries that are part of the union. However, countries will be allowed to reduce this limit further.
Currently, Spain has one of the lowest limits for this, allowing citizens to pay up to €1,000 in cash. However, the European Central Bank (ECB) disagreed with the case in 2018, as the institution called the measure “disproportionate” because it could limit the use of cash as effective legal tender. .
Cash payments are not the only ones affected by this new round of measures. Other sectors, including jewelery and goldsmithing, will also be subject to increased scrutiny by the body.
Zbynek Stanjur, Minister of Finance of the Czech Republic, said:
Cash payments over 10,000 euros will not be possible. It will be much more difficult to remain anonymous when buying or selling crypto assets. Hiding behind multiple layers of business ownership will no longer work. It becomes even more difficult to launder dirty money with jewelery or silverware.
The bloc will also introduce a new country classification system that will reflect each level of compliance with Financial Action Task Force (FATF) recommendations, including gray and black lists.
Cryptocurrency transactions are also included
As Zbynek Stanjur indicated, cryptocurrencies will also be included in this package. The European Union has agreed that cryptocurrency transactions worth more than €1,000 will be subject to due diligence investigations by the Virtual Asset Service Providers (VASPs) that facilitate them.
In addition, the European Union will subject VASPs to the same level of anti-money laundering and anti-terrorist financing controls as other financial institutions. These exchanges and custodian service providers will need to implement risk limitations when handling self-hosted wallets, as well as other specific measures to control cross-border payments using cryptocurrencies.