Understanding the EU AMLR and Its Impact on Crypto
In the dynamic world of cryptocurrency, regulatory frameworks are often at the core of debates surrounding innovation and compliance. Recently, misinformation about the European Union’s Anti-Money Laundering Regulation (AMLR), set for implementation in 2027, has been making rounds. Patrick Hansen, Director of EU Strategy and Policy at Circle, stepped forward to debunk myths regarding self-custody wallets and peer-to-peer crypto transactions under the new framework.
Will AMLR Ban Self-Custody or Peer-to-Peer Crypto Transactions?
Hansen clarified that the AMLR is designed to target crypto-asset service providers (CASPs) such as exchanges, brokers, and custodial wallets—not individual users who prefer self-custody solutions to store their crypto assets. This distinction is crucial for crypto enthusiasts in the European Union as self-custody wallets, which allow individuals to maintain full control of their digital assets, remain unaffected by the proposed regulation.
“A bunch of big crypto accounts are claiming upcoming AML rules will ban self-custody or anonymous crypto & Bitcoin transactions in the EU. That’s wrong,” Hansen pointed out in a recent X (Twitter) thread, as he called out widespread misinformation circulating online.
How AMLR Reinforces Existing Practices
Contrary to social media panic, Hansen emphasized that the AMLR builds on existing compliance standards, such as the FATF’s travel rule, rather than proposing sweeping new restrictions. For example, early drafts suggested severe limitations like €1,000 caps on self-custody payments and extending AML obligations to decentralized platforms (DAOs and DeFi projects) and NFT-related infrastructure. These provisions were removed to encourage innovation while adhering to safety measures.
Keeping Innovation Alive Through Advocacy
The crypto community’s proactive advocacy efforts, highlighted by Hansen, played a crucial role in shaping the final AMLR text. Such efforts ensured a
