The European Banking Authority (EBA) has expanded its Travel Rule guidelines to include cryptocurrency service providers and intermediaries, aiming to combat money laundering and terrorist financing. Effective December 30, 2024, Regulation (EU) 2023/1113 mandates that crypto exchanges operating within the European Union adhere to stringent reporting rules for fund transfers and crypto assets. This initiative, under the EU’s Markets in Crypto-Assets Regulation (MiCA), subjects crypto-asset service providers (CASPs) to the EU’s Anti-Money Laundering/Countering the Financing of Terrorism (AML/CFT) framework.
Payment service providers (PSPs), intermediary PSPs, CASPs, and intermediary CASPs have a grace period of two months to demonstrate compliance, which includes collecting user information and identifying the purpose of transactions. The EBA acknowledges the potential financial impacts on crypto exchanges and service providers but argues that the long-term benefits of enhanced AML/CFT measures justify the initial costs. The guidelines are expected to strengthen efforts against money laundering and terrorist financing.
In response to tightening regulatory oversight in Europe, blockchain protocols are adapting. The Cardano Foundation, in collaboration with the Crypto Carbon Ratings Institute, has developed sustainability metrics for the Cardano network. This initiative ensures compliance with MiCA regulations, emphasizing Cardano’s energy-efficient proof-of-stake protocol compared to energy-intensive proof-of-work alternatives.
The sustainability report details metrics such as annualized electricity consumption, carbon footprint, and marginal power demand per transaction per second. By adhering to these standards, Cardano aims to promote environmental sustainability in blockchain technology while meeting regulatory requirements.
Source: thepaypers.com
