Italian Central Bank: No AML Requirement for Bitcoin Exchanges

Digital currency exchanges are not required to comply with anti-money laundering rules, according to new guidance from the Banca d'Italia.

AccessTimeIconFeb 5, 2015 at 3:40 p.m. UTC
Updated Sep 11, 2021 at 11:30 a.m. UTC

Digital currency exchanges in Italy are not required to enforce anti-money laundering policies, according to the country's central bank.

Banca d'Italia issued three notices on 30th January advising financial institutions not to hold or deal in digital currencies in the absence of a regulatory regime.

However, one of the notices, from the bank's Financial Intelligence Unit, clarified that businesses dealing in the exchange of digital and fiat currencies are not required to comply with anti-money laundering rules.

"The use, exchange and storage of digital currencies and their conversion to legal currencies are not addressed by the money-laundering legislation and therefore are not required to comply with requirements of customer data recording and reporting of suspicious transactions," the notice says.

However, the bank did strongly encourage firms dealing in digital currency exchange to voluntarily apply AML rules.

The bank's overall position is in line with statements about digital currencies made by the European Banking Authority last July and first set out by the European Central Bank in December 2012.

Following the EBA line

The Italian central bank's statement has been cautiously welcomed by cryptocurrency businesses and activists in the country.

Andrea Medri, who founded cryptocurrency exchange The Rock Trading in Italy, said he was pleasantly surprised by the tone of the central bank's guidance, but only because he expected more negative rhetoric.

"When we talk about central banks we always expect the worse, but in my opinion it is not as bad as it could have been," he said. "We are cautiously optimistic."

Medri said the latest announcements did not contain any explicit new guidance for firms like his, although he welcomed the fact that the central bank appeared to be building on guidance from European regulators.

The central bank's latest guidance should be viewed as a positive development for the cryptocurrency industry in Italy, said Giulia Aranguena, a lawyer who advises Cashless Way, an association that promotes digital payments.

"This is a very good first step for our market to organise and give a sort of certainty, it is very positive ... indirectly it is recognising the role and importance of digital currencies," she said.

Mixed response from entrepreneurs

The Rock Trading's founder said he is particularly interested in regulatory movements surrounding bitcoin in Italy because he had moved his firm to Malta and is seeking to return to Italy if the regulatory environment becomes more settled.

The entrepreneur said his exchange implemented voluntary AML and know-your-customer rules a year ago, so the latest announcements would have had no impact on his operations, even if still based in Italy.

Italian law-makers are actively engaged with the cryptocurrency community, but are likely awaiting guidelines from European authorities before making further moves, Medri said.

"I believe, eventually, Italy will require the equivalent of a money-transmitter's licence in the United States, and I hope they will create a dedicated licence for [the digital currency] industry," he said.

Other market-watchers agree with Medri's assessment that Italian regulators are likely waiting for European authorities' cue.

One such observer is Franco Cimatti of Bitcoin Foundation Italy, a trade organisation that is not affiliated with the Bitcoin Foundation. He warns that the central bank's latest guidance should be viewed critically because local legislators are far from agreement on how digital currencies should be governed.

"Even if this seems like good news, it will not stop our politicians from creating bad laws. We are still keeping our eyes wide open to see what will happen in the future," he said.

Featured image from Andrea Giovanni / Flickr


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