EU and 8 Nations Sign New Treaty to Fight Crypto Crime

The European Union and eight allied nations have officially joined forces to sign a landmark agreement aimed at tackling crypto-funded crime and terrorism financing. The new treaty updates an existing international framework known as the Warsaw Convention, bringing digital assets firmly into its legal scope.

By updating these rules, governments are giving law enforcement agencies the ability to act much faster across borders. This international cooperation is designed to cut down response times and make it significantly harder for criminals to move illicit funds through digital networks.

Which Nations Have Signed the Protocol?

The signing ceremony brought together representatives from across Europe and neighboring regions. The primary signatories included the European Union alongside eight individual partner nations:

• Georgia
• Greece
• Hungary
• Luxembourg
• Monaco
• Montenegro
• San Marino
• United Kingdom

Together, these initial subscribers represent a united effort to standardize how digital asset crimes are investigated and prosecuted across sovereign borders.

How the Updated Warsaw Convention Works

Originally, the Council of Europe's Warsaw Convention focused on traditional financial laundering, asset searches, and confiscation. However, as digital currencies became more widely adopted, authorities realized that legacy legal frameworks were too slow to deal with the speed of blockchain transfers.

The new Additional Protocol explicitly defines virtual assets and Virtual Asset Service Providers (VASPs). This ensures that crypto exchanges, wallet providers, and other service platforms fall under the exact same oversight standards as conventional financial institutions.

Key Powers Granted to Authorities

Under the terms of the updated protocol, member states will gain access to several new procedural mechanisms to act against illegal funds quickly.

1. Urgent Emergency Asset Seizures

One of the most significant changes is the ability to perform urgent asset confiscations without giving prior notice to suspects. If authorities detect an active risk that crypto funds are about to be moved or laundered, they can step in immediately to secure the assets.

2. Specialized Crypto Taskforces and Repositories

The protocol requires participating countries to establish specialized infrastructure for managing digital evidence. Nations will build Asset Recovery Offices to track down stolen or illicit tokens, alongside Asset Management Offices responsible for securely storing and managing seized digital assets.

3. Direct Transaction Freezes by Financial Intelligence Units

National Financial Intelligence Units (FIUs) are receiving enhanced regulatory authority. If an FIU suspects that a specific crypto transaction is linked to money laundering or illegal activity, it now has the power to temporarily suspend or halt the transaction on the spot.

What Happens to Recovered Crypto Funds?

The protocol sets clear guidelines on how confiscated assets should be distributed once an investigation wraps up successfully:

• Priority to Victims: Victims and affected parties will always have priority when reclaiming stolen assets.
• Cross-Border Asset Sharing: For recovered sums exceeding 10,000 euros, the remaining proceeds will be split equally among all participating countries involved in the joint operation.
• Public Interest and Social Reuse: Signatory nations are encouraged to pass local laws allowing confiscated crypto funds to be redirected toward public interest initiatives or social causes.

Why Global Cooperation Matters

Because blockchain networks operate globally without physical boundaries, law enforcement officials emphasized that individual nations cannot effectively stop international financial crime on their own.

"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."

Alain Berset, Secretary General of the Council of Europe, highlighted that joint agreements are essential to preserving financial integrity and protecting public security.

A Broader Push for Crypto Oversight in Europe

This international treaty is part of a larger, ongoing effort across Europe to strengthen digital asset regulations. First adopted by Council of Europe member states in May 2026, the framework aligns with domestic legal actions taking place across the continent.

For instance, France's Council of State recently rejected an emergency appeal by crypto companies Bull BitcoinBTC+0.54% and Paymium, which sought to pause strict data reporting rules. Courts upheld the rules, reinforcing the message that European authorities are prioritizing compliance and transparency across the digital asset industry.