LONDON: To stop money laundering, terrorism financing, and other crimes, the European Union (EU) lawmakers have passed new legislation allowing the tracing of transactions of digital assets like Bitcoin in the same way as regular financial transfers.
On a new bill intended to guarantee that cryptocurrency transfers can always be traced and erroneous transactions are stopped, the negotiators came to a tentative agreement.
Ernest Urtasun, co-rapporteur for the Committee on Economic and Monetary Affairs, stated that "this new rule enhances the European framework to fight money-laundering, reduces the risks of fraud, and makes crypto-asset transactions more secure"
The EU travel rule will ensure that providers of crypto asset services can stop and identify sanctioned addresses and that transfers of crypto assets are completely traceable, according to a statement from Urtasun. The agreement broadens the use of traditional finance's "travel rule" to cover transfers of cryptographic assets.
In accordance with the new legislation, "Crypto-assets service providers (CASPs) will be required to give this information to competent authorities if an inquiry into money laundering and terrorist funding is launched."