Luxembourg flags crypto companies as high risk for money laundering

Luxembourg’s 2025 risk report classifies crypto companies as high risk for money laundering, even as local institutions ramp up crypto adoption efforts.

Luxembourg classified virtual asset service providers (VASPs) as high-risk entities for money laundering in its 2025 National Risk Assessment (NRA), highlighting concerns over the crypto industry’s exposure to financial crime.

According to the report, the inherent risk level of VASPs is deemed “High,” driven by factors including transaction volume, client reach, distribution channels, legal structures and the international scope of operations.

The NRA identified VASPs as an emerging risk in its 2020 report after “a detailed assessment of ML inherent risks emerging from virtual assets.” This was followed by a 2022 NRA report deeming “the risks associated with crypto assets and virtual currencies as very high,” because, among other things, they are internet-based and cross-border.

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