The EU Response to Criminal Misuse of Cryptocurrencies: The Young, already Outdated 5th Anti-Money Laundering Directive

What is it about?

Whilst policy-makers are still groping for suitable regulation of the fast-paced industry of crypto-assets, governments and international organizations worldwide are focusing their efforts on combating criminal misuses of cryptocurrencies. Among the most recent landmark steps is the extension of the Financial Action Task Force (FATF) international standards against money laundering and terrorism financing over virtual assets, which echoed the first legislative measure regulating virtual currencies adopted by the EU a year before: Directive 2018/843/EU, better known as the 5th AML Directive. _x000D_ The implementation of the anti-money laundering and counter-terrorism financing preventive framework over cryptocurrencies schemes, which EU Member States were required to transposed into national law by January 10th 2020, looks however as a new, albeit by many aspects already outdated legal framework. By adopting a cross-cutting approach, the present contribution aims to provide an in-depth legal analysis of the 5th AML Directive for the purpose of identifying shortfalls and challenges that lay ahead to effectively tackle criminal misuse of cryptocurrencies. It ultimately argues that the preventive anti-money laundering measures cannot dispense with the establishment of a cross-border integrated supervisory and enforcement system.

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