EU expands local contact point requirement for cross-border crypto firms

The European Commission has adopted a Delegated Act expanding the authority of member-state financial regulators to require crypto exchanges and virtual asset service providers operating across borders to designate a local Central Contact Point, AML Intelligence reported. The framework, previously applied only to electronic money institutions and payment institutions, has now been extended to the crypto sector. Through a local CCP, host-country AML/CFT supervisors will be able to monitor in real time whether overseas CASPs headquartered in other countries are filing suspicious transaction reports and complying with anti-money laundering controls. The change is expected to increase administrative and operational costs for crypto exchanges and service providers, including local compliance hiring and contact network setup, depending on each member state's requirements.