European banking authority issues new guidelines for crypto providers to comply with restrictive measures

This case highlights that, despite rigorous measures imposed on the DeFi sector, traditional financial institutions continue to face significant money laundering challenges. The EBA's guidelines emphasize the need for robust internal controls across all financial sectors to prevent similar lapses.

The EBA's guidelines, which will take effect from December 30, 2025, require PSPs and CASPs to implement reliable screening systems to ensure compliance with EU sanctions. These systems must monitor information to mitigate the risk of entities or individuals breaching restrictive measures or attempting to evade them.

The guidelines stem from the EU’s Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) reforms initiated in 2021. These reforms aim to enhance transparency and protect the financial system from illicit activities. Regulations enforcing the new standards were adopted on June 9, 2023, and will come into force on December 30, 2024.

According to a report from Grand View Research, the global anti-money laundering (AML) market was valued at USD 1.51 billion in 2023, with a projected compound annual growth rate (CAGR) of 16.0% from 2024 to 2030. A report from Chainalysis noted that crypto-related money laundering has decreased by 30% over the past year, with cryptocurrencies expected to represent just 0.47% of total money laundering activities in 2024.