The European Union and eight partner countries have become the first signatories to a new protocol aimed at tackling the use of cryptocurrency in money laundering and terrorist financing.
Georgia, Greece, Hungary, Luxembourg, Monaco, Montenegro, San Marino and the United Kingdom joined the EU on Wednesday in signing the Additional Protocol to the Council of Europe Convention on laundering, search, seizure and confiscation of the proceeds from crime and on the financing of terrorism.
The agreement updates the treaty commonly known as the “Warsaw Convention” by bringing crypto assets within its scope. It also gives national Financial Intelligence Units (FIUs) new powers and is designed to improve international co-operation by reducing the time needed to respond to information requests between countries.
“Criminal money sustains organised crime. It also buys what should never be for sale: our democracies. Taking that money away is democratic security. No state can recover criminal assets across borders on its own. With this Protocol, none will have to,” said Alain Berset, Secretary General of the Council of Europe.
The protocol sets out procedures for recovering and managing crypto assets connected to criminal or other illicit activity. It formally covers virtual assets and virtual asset service providers (VASPs).
Under the new rules, authorities can seek the urgent confiscation of virtual assets without prior notice where there is a risk that they may be transferred. The measures also call on signatories to establish dedicated Asset Recovery Offices to confiscate digital assets and Asset Management Offices to hold them.
National FIUs will be able to suspend crypto transactions where they suspect links to money laundering. The expanded powers are intended to allow authorities to intervene more quickly when digital assets are believed to be connected to criminal proceeds.
The protocol also sets out how recovered assets should be handled. People affected by the offences will have priority when seeking the return of confiscated property. Where more than 10,000 euros is recovered, the money will be divided equally between the countries involved in the recovery operation.
Signatory states are further encouraged to introduce laws allowing confiscated crypto assets to be used for “purposes of social reuse, in the public interest or for other specific aims.”
Council of Europe member states adopted the provisions in May 2026, as the bloc seeks to strengthen the EU’s fiscal and criminal-law tools and bring crypto assets under effective oversight.
