According to EU regulators, cryptocurrency exchanges should lose their licenses if they commit money

If crypto exchanges are found to have seriously broken anti-money laundering rules, their licenses should be revoked, according to European Union financial supervisors.

The recommendation comes as lawmakers near the end of a landmark bill known as the Markets in Crypto Assets Regulation, or MiCA, which establishes a regulatory framework for virtual asset companies across the EU's 27 member states.

According to a report released Wednesday by the three European supervisory authorities responsible for overseeing banks, insurers, and securities markets, regulatory authorities responsible for authorizing or registering crypto exchanges and wallet providers should "be empowered to withdraw the authorisation/registration for serious breaches of AML/CFT [anti-money laundering and terrorist financing] rules."

The MiCA should "appropriately integrate AML/CFT issues in prudential supervision of entities," according to the report, which examines whether anti-money laundering powers in rules for various financial sectors are adequate. MiCA mandates that stablecoin issuers maintain adequate capital reserves and be monitored by regulators like Germany's BaFin.

One of the remaining snags in the bill is whether it should include tougher anti-money laundering safeguards or leave the issue for a separate, broader review of dirty money rules.

Major players like Binance, the world's largest crypto exchange by volume traded, have now registered in EU countries like France and Italy, and the bloc is tightening its anti-money laundering (AML) laws in the wake of a string of scandals involving traditional lenders like Danske Bank and Pilatus in Malta.

By fLEXI tEAM