The European Banking Authority (EBA) has released new guidelines aimed at ensuring compliance with the European Union's restrictive measures for payment service providers (PSPs) and crypto-asset service providers (CASPs).
The announcement on Nov. 14 underscores the EU's commitment to strengthening the regulatory framework governing financial transactions, including crypto transfers.
Clearer Compliance for Crypto and Payment Providers
The guidelines specify the responsibilities of services providers when transferring funds or cryptocurrencies, ensuring adherence to both EU-wide and national sanctions. According to the EBA, these measures integrate seamlessly with broader governance and risk management frameworks to mitigate operational and legal risks.
Strengthening Financial Ecosystem
Weak controls and policies within financial institutions, including CASPs, have the potential to undermine the EU’s restrictive measures regimes. The EBA emphasized that such vulnerabilities could not only expose institutions to risk but also facilitate rule circumvention, jeopardizing the stability of the financial ecosystem.
To address these risks, the guidelines mandate the use of robust screening systems to prevent entities or individuals from violating restrictive measures or circumventing EU sanctions.
Implementation Timeline
The new guidelines will officially apply starting Dec. 30, 2025, allowing institutions sufficient time to adapt to the stricter regulatory requirements. These guidelines complement the EU’s broader Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) legislative reforms.
CASPs handling crypto transfers must implement reliable systems to screen information and monitor transactions.
Evolving Landscape for Financial Regulation
This move follows the EU’s adoption of comprehensive AML reforms in June 2023, including rules on fund and crypto transfers. The legislative package represents a significant step in harmonizing financial regulations across the bloc. The EBA’s new guidelines are a critical tool to ensure compliance as these regulations come into force.
By introducing these measures, the EBA continues to play a role in aligning traditional financial services and emerging technologies like cryptocurrency with the EU’s regulatory and security objectives.