The European Union’s (EU) finance ministers signed off on landmark new crypto regulations on Tuesday.

The EU Council, representing 27 member states, approved Markets in Crypto Assets Regulation (MiCA), allowing the EU to become the first major jurisdiction in world with a crypto license regime. The EU also approved new anti-money laundering regulations for crypto funds transfers.

“I’m very happy that we’re able to deliver on our promise today and start regulating crypto-assets. Recent events have reinforced the need to impose rules that will better protect Europeans, who have invested in crypto assets. They also prevent the misuse of the crypto industry for money laundering and funding terrorism.

After last week’s ambassadors’ approval of tax and MiCA, it was widely expected that the laws would be agreed upon.

MiCA mandates that crypto firms, such as exchanges and wallet providers, obtain a license in order to operate within the EU. Stablecoin issuers must also hold adequate reserves. Its major features were agreed upon politically in July but have been delayed by administrative delays. The major provisions will take effect a little over a year from the date it is published in the official journal of the EU, which could be June or July.

Later that day, Ministers also agreed to new actions which would force crypto providers to reveal details about their customers’ holdings to tax authorities . This information will be shared across the bloc to prevent funds being stashed in secret offshore wallets.

Crypto-assets, e-money and digital currency have the potential to be a great driver of economic activity and innovation. But they can also reduce transparency and enable tax fraud or evasion. Updates to our tax rules will allow national administrations collect taxes more efficiently, and keep pace with the evolving technology, as Europe continues its digital transformation.

The European Commission proposed the new tax rules known as DAC8 in December based upon a model developed by the OECD. On Friday, the latest draft was released. The European Parliament still hasn’t given its non-binding view on the matter.

Read more about the EU’s approval of crypto licensing and funds transfer rules

Updated (May 16, 0934 UTC): Added detail and quotes about agreement related to the new tax measures in all of the article.

Sandali Handagama is the editor.