#DigitalAssetBill The European Union is set to introduce a sweeping set of anti-money laundering (AML) rules targeting the cryptocurrency sector, with enforcement expected to begin in 2027. Under the new Anti-Money Laundering Regulation (AMLR), privacy-focused cryptocurrencies and anonymous crypto accounts will be effectively banned across the bloc.

According to the European Crypto Initiative (EUCI), the upcoming regulations will prevent banks, financial institutions, and crypto asset service providers (CASPs) from supporting accounts or services that enable anonymity. Article 79 of the AMLR, detailed in the EUCI’s AML Handbook, explicitly outlines these restrictions.

This legislation is part of a broader AML framework covering everything from traditional bank and payment accounts to crypto assets that facilitate anonymous transactions. It also targets products such as anonymous passbooks and safety deposit boxes, emphasizing the EU’s intent to eliminate financial opacity.

Savova, senior policy lead at the EUCI, explained that although the core regulations—AMLR, AMLD, and AMLAR—have been finalized, several implementation specifics are still under development. These will be clarified through delegated and implementing acts, largely overseen by the European Banking Authority (EBA), with the EUCI actively engaging in ongoing consultations.

Additionally, the new framework will place certain CASPs under direct supervision by the EU’s Anti-Money Laundering Authority (AMLA), provided they operate in at least six member states. Starting July 1, 2027, AMLA will begin selecting 40 such entities for oversight, ensuring at least one is chosen from each member country. Criteria for selection include having over 20,000 customers in a given member state or processing more than 50 million euros in transactions.

The regulations will also introduce mandatory customer due diligence for crypto transactions exceeding 1,000 euros, reinforcing transparency standards across the industry.

These moves come as combat the use of cryptocurrencies in illicit activities.