In the tiny Baltic nation of Estonia, the Ministry of Finance is expected to make amendments to a new financial crimes law that will tighten the regulation of digital currencies. Called the Anti Money Laundering and Terrorist Financing Prevention Act, the bill became law this week. Its purpose was to change the nation's financial laws so as to meet the requirements of the European Union's Fourth Money Laundering Prevention Directive. This 2015 law required member nations to take steps to make sure that their financial systems would not be used for the purposes of money laundering. Originally, the Estonian law only mentioned "alternative means of payment service provider[s]," but it has since been changed to include "virtual currency exchange service providers" and "virtual currency payment service providers." Estonia's Financial Supervision Authority believes that both cryptocurrencies and cryptocurrency-related services pose specific risks related to money laundering. This is why amendments will be made to the existing law. Recently, Estonia changed its mind about issuing its own digital currency. Dubbed the Estcoin, the coin was intended to become the nation's official virtual currency, and it was to be used extensively by foreigners who do business in the country. It was also to serve as an electronic identification system. However, the coin was shelved over the summer in response to criticism from both Mario Draghi, who is the President of the European Central Bank, and local banking authorities. Draghi said that no member of the European Union could introduce its own currency, as the euro was already the official currency of the union. Estonia is not the only country that has been considering tightening cryptocurrency regulations. Canada is also considering regulating cryptocurrencies, and for the same reason that Estonia is doing it: to prevent money laundering. In the middle of last month, the country's House Finance Committee recommended regulating digital currencies after reviewing the nation's Proceeds of Crime Money Laundering and Terrorist Financing Act.
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