New EU Regulations Track Crypto Transactions Above €1,000

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The new EU regulations on crypto transactions are about to change everything. It will be a new era for those who rely on cryptocurrencies to move heavy funds.
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The crypto industry has managed to evade government oversight since its inception. It has become a haven for transactions as it is decentralized. The market controls crypto transactions, unlike centralized institutions like banks and other financial services.

Governments have recently made moves to regulate crypto trading. We’ve seen this trend in central banks introducing digital currencies. However, it still stayed beyond their reach until now.

The new EU regulations on crypto transactions are about to change everything. It will be a new era for those who rely on cryptocurrencies to move heavy funds. So, let us find out what it is, how it will affect the coin community, and what you can do.

The New EU Regulation on Crypto

There are so many illegalities in the crypto industry. Governments are grappling with the trend to halt money laundering. While there has been success in the endeavor, many loopholes still exist.

Some governments have placed an outright ban on crypto transactions. Even exchanges must be licensed to operate digital assets. Recently, members of the EU block met to roll out a new regulation that will check crypto’s excesses.

The new regulation, which is a definitive version of Markets in Crypto (MiCA), will bring limits to transactions. People will be unable to transact anything worth more than €10,000 in cryptocurrencies. Also, transactions above €1,000 will come under heavy scrutiny and be subject to restrictions.

The Czech finance minister reiterates that the move is intended to prevent money laundering. This news is not welcome among the heavy hitters in the industry. Furthermore, limiting transactions takes us back to the fiat currency era. That is the very thing cryptocurrencies were meant to avoid.

Is there a way to curb money laundering without these restrictive measures? The new EU crypto regulation aims to introduce transparency, authorization, and consumer protection. However, this regulation has been in the works since it was proposed two years ago, according to a tweet.

FTX’s Collapse and the New Regulation

We all knew that regulations in the crypto space were only a matter of time. Centralized exchanges will have to abide by the new rules once MiCA is live. However, it does not extend to DeFIs.

FTX’s collapse was a wake-up call to the government and consumers. Hence, the need for a safe environment became more necessary than before. Some might argue that the collapse hastened the EU’s new regulation.

Whether FTX’s collapse has anything to do with it or not, the truth remains: we need some safety mechanisms. However, the transaction limits and outright monitoring defeat the purpose of cryptocurrencies. It will make it more centralized than ever.

What Can You Do If You Want to Trade Above €10,000?

You should note that the new MiCA regulations only apply to centralized crypto exchanges. As a result, you can take your transactions to decentralized platforms and still enjoy high limits. It will require a complete rework of your operations, but the stress is worth it.

Centralized platforms have become more popular as they operate similarly to conventional trading platforms. However, the new regulation will tighten the grip on them. While we grapple with the realities of this passive MiCA act, the ECB president, Christine Lagarde, is already calling for MiCA II for DeFIs.

The upgraded regulation will now extend to decentralized financial services. Although we have yet to learn the details of the proposed act, it will be similar to what MiCA brings.

The battle for control of the crypto space is heated, and governments are becoming bolder by the day. It is only a matter of time before cryptocurrencies get the same rules as fiat currencies. Moreover, what good will it do if you have coins but cannot trade them?

Final Thoughts

The crypto industry has enjoyed freedom from mainstream authorities for a while. It has operated beyond the total reach of the government and its attendant institutions. However, FTX’s collapse was an eye-opener to many.

People now have a softer spot for regulations. The new MiCA Act will introduce rules for crypto transactions. One of them is the prohibition of trades above €10,000. In addition, trades above €1,000 will be monitored and heavily evaluated.

It is a new era for the EU, and we will not be surprised if this movement spreads to other regions. There is no better time to introduce it than now. Moreover, people are in desperate need of security in crypto trading.  

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TrustPedia is a financial portal-based research agency. We do our utmost best to offer reliable and unbiased information about crypto, finance, trading and stocks. However, we do not offer financial advice and users should always carry out their own research.

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