By Shelly Melancon (Switzerland)
New registration guidelines have been issued by the central bank of Spain for local virtual currency providers or VASP including the banks in the country. This guideline includes instructions on the registration of local virtual currency service providers to prevent money laundering. The registration requests of these VASPs can be submitted to the central bank via an electronic registry.
Thus new regulation by the Central Bank of Spain will affect all individuals and institutions that use crypto exchange services. They will have to sign up via the new AML registry by the Central Bank.
Compulsory Registration for VASPs
The central bank of Spain issued these new guidelines on Oct. 19, and it was stated by the bank that the guideline applied to every individual and institution that provides virtual currency exchange services. So long as an individual or institution provides a platform for cryptocurrency trading and custody services to retail traders and institutional investors.
This new registration requirement for VASPs is compulsory and independent of other registrations these individuals and institutions have done with the central bank or other relevant authorities. Hence, the VASPs will have to carry out this new registration process with the central bank.
Also read:According to the central bank, the registration requirement is still binding on institutions with end customers outside of Spain. The central bank also recommends that individuals use the electronic registry form though they can also register through other means such as mail.
Preventing Illegal Activities Through Cryptocurrency
According to the official statement, the central bank will require both individuals and institutions to make reports on the measures they are taking to prevent illegal activities such as money laundering and terrorism financing. Also, they will be required to include, in their report to the central bank, certain information about their customers which the central bank deems important to its operations.
Based on the official release, the central bank will conduct an analysis of data while weighing potential risks. Also, this will take into account the kind of customers operating an account with the VASPs, their countries of operation, the products they offer, volumes of the providers, and several other factors.
El Pais, a local news agency, has reported that in June 2021 the Central Bank of Spain already had plans to institute AML procedures for VASPs. Also, in August the Spanish lawmakers supported an initiative to legalize using cryptocurrency for functions such as mortgage and insurance.
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