DeFi protocol frontend in Luxembourg

Custodian wallet providers registered with the CSSF as VASPs under AML law Art 7-1 kept that registration only until 1 July 2026, or until the CSSF granted or refused MiCA authorisation if earlier (AML law Art 24-1); Art 7-1 was repealed by the Loi du 6 février 2025, so crypto custody now requires a MiCA authorisation or notification.

Luxembourg's VASP registration was governed by Art 7-1 of the Law of 12 November 2004, inserted by the Loi du 25 mars 2020 (Mémorial A n° 193), while a companion Loi du 25 mars 2020 (Mémorial A n° 194) transposed AMLD5 (Directive 2018/843); Art 7-1 was repealed by Art 17 of the Loi du 6 février 2025.

Crypto-asset service providers are obliged professionals under Art 2(1) point 20 of the Luxembourg AML law and must meet its professional obligations (risk assessment, customer due diligence, internal organisation, cooperation and suspicious-transaction reporting, Arts 2-2 to 5), supervised by the CSSF (Art 2-1).

Law of 12 November 2004 on combating money laundering and terrorist financing (as amended, including by the Law of 25 March 2020 on virtual assets):

CSSF Circular 22/811 (and previous versions like 20/747 and 21/769 which it consolidates/replaces): This circular provides detailed guidance on AML/CFT obligations for VASPs.

MiCA authorisation has replaced registration in Luxembourg: under AML law Art 24-1 a VASP's CSSF registration ended when the CSSF granted or refused authorisation under MiCA Art 63, and in any event on 1 July 2026; the CSSF is the competent authority under Art 20-27 of the amended Law of 16 July 2019.

Regulation (EU) 2023/1114 on Markets in Crypto-Assets (MiCA):

MiCA Regulation (EU) 2023/1114, Article 3(1)(14) (Definition of "custody and administration of crypto-assets on behalf of third parties") and Title V (Authorization and operating conditions for crypto-asset service providers).

The Law of 12 November 2004 on the fight against money laundering and terrorist financing (ELI /eli/etat/leg/loi/2004/11/12/n1/jo) is Luxembourg's core AML/CFT statute. A Law of 25 March 2020 (a194) transposing Directive (EU) 2018/843 added virtual asset service providers to it, and a second Law of 25 March 2020 (a193) inserted the CSSF VASP registration (Art 7-1). Since the loi du 6 février 2025, Art 2(1) point 20 covers crypto-asset service providers and Art 7-1 is repealed.

CSSF Circular 20/747 (as amended by Circular 22/815): This circular is crucial for VASPs as it consolidates and specifies the AML/CFT professional obligations under the amended AML Law for all entities subject to CSSF supervision, including VASPs. It provides detailed guidance on risk assessment, customer due diligence, internal organisation, and reporting requirements.

Exchange services: Exchanging virtual assets for fiat currencies or other virtual assets.

Custodial wallet providers: Entities that provide services to safeguard private cryptographic keys on behalf of their customers, to hold, store and transfer virtual assets.

Transfer of virtual assets: Services involving the movement of virtual assets between addresses or accounts.

Evidence fact lu.aml.identification-and-verification not found (may have been renamed).

Obtain and verify the customer's name, residential address, date and place of birth, nationality, and a unique identification number (e.g., from a passport or national ID card).

Verify identity using reliable, independent source documents, data, or information (e.g., government-issued photo ID, proof of address utility bill).

Under Art 3(2)(b) of the Luxembourg AML law of 12 November 2004, customer due diligence includes identifying the beneficial owner and taking reasonable measures to verify their identity. Art 1(7) treats a shareholding of 25% of the shares plus one, or an ownership interest of more than 25%, held by a natural person as an indication of direct ownership; for trusts and fiducies the beneficial owners include the settlor, trustees, beneficiaries and any person exercising ultimate control.

Scrutinize transactions undertaken throughout the course of the relationship to ensure they are consistent with the VASP's knowledge of the customer, their business, and risk profile.

Regularly review and update customer identification data, especially for high-risk clients.

Enhanced Due Diligence (EDD): Required for situations posing a higher ML/TF risk, including:

Politically Exposed Persons (PEPs), their family members, and close associates.

Transactions involving high-risk jurisdictions.

Complex or unusually large transactions, and all unusual patterns of transactions, that have no apparent economic or lawful purpose.

Issuing warnings for unregistered activities.

Ordering non-compliant entities to cease operations.

Evidence fact lu.enforcement.focus-on-registration-and-amlcft not found (may have been renamed).

The CSSF register of virtual asset service providers lost its legal basis: the loi du 6 février 2025 repealed the VASP registration article (AML law Art 7-1), and VASPs registered on 30 December 2024 stayed on the register only until 1 July 2026 or an earlier MiCA decision (AML law Art 24-1). Authorised crypto-asset service providers appear in the ESMA interim MiCA register, which listed 13 entries with home Member State Luxembourg on 14 October 2026.

CSSF Circular 23/843 (Relevant for AML/CFT for VASPs):