EU Strengthens Crypto Supervision Under Anti-Money Laundering Regulations

The European Union is strengthening its anti-money laundering (AML) regulations to bring large cross-border crypto firms under direct supervision, even if they operate remotely without a physical presence in each member state.

The framework allows the EU Anti-Money Laundering Authority (AMLA) to supervise high-risk financial institutions operating across at least six member states, including crypto-asset service providers. To be considered for direct AMLA supervision, firms must have more than 20,000 resident customers in a single member state or process over €50 million in annual transactions for those customers.

The regulations aim to combat money laundering and terrorist financing in the cryptocurrency sector by introducing enhanced requirements for customer due diligence, cross-border crypto relationships, and transfers involving self-hosted addresses. The EU's AML Regulation explicitly includes crypto-asset service providers within its financial-institution definition.

AMLA will start its first selection process in July 2027, with direct supervision scheduled to begin in 2028. Up to 40 high-risk financial institutions or groups are expected to be selected for direct EU-level AML supervision.