According to recent reports, the Republic of Ireland has enacted a strict law against cryptocurrency companies. According to a recent report, Ireland requires all virtual asset service providers (VASPs) to register with the country’s central bank. Also, all local digital asset companies must comply with the sixth anti-money laundering guidelines (6AMLD) set by the European Union (EU).
As the country incorporated the EU’s 5th Anti-Money Laundering Directive (5AMLD) into its local law, the encryption industry’s new rules have been implemented. The directive takes effect from April 23rd. This means that the directive has been active for the past four days. The regulation will also require registration of foreign cryptocurrency companies that provide services to Irish citizens.
Cryptocurrency companies in Ireland have three months to comply
However, the full implementation of the law is not instant. Irish crypto companies must now register with the Central Bank of Ireland within the next three months. These companies will also have to conduct due diligence on their customers. This means that they will have to know the source and destination of their crypto assets. Furthermore, the crypto companies will have to report any suspicious financial activities.
This may be just the beginning of Irish crypto regulation. It is expected that by June 3, all virtual asset service providers in the world serving European countries will comply with the EU’s sixth anti-money laundering directive. 6AMLD will require any VASP of European customers to register with EU authorities and meet strict reporting requirements.
Unlike 5AMLD, the updated guidelines give European authorities the ability to punish companies and related legal entities. Non-compliance means that the companies may face huge fines or mandatory shutdowns.
These new laws are very necessary in order to check financial crimes. According to an Austrian agency, there should be a proper check on cryptocurrency transactions. The agency claims that about 60% of financial crimes in the country have connections to cryptocurrencies. This is why many governments are now putting stringent laws on cryptocurrency transactions.
India is currently on the front row to ban cryptocurrency. However, the government is now having a rethink after considering the subsequent backlash that will follow. Nevertheless, where there will not be a ban, there will be strict regulations. This will put hoodlums who plan to carry out financial fraud with cryptocurrencies in check.