Coinbase Europe Hit with $24.7M AML Fine in Ireland

The financial technology landscape is increasingly under the microscope of regulatory bodies worldwide, with a particular focus on the burgeoning cryptocurrency sector. In a landmark move, the Central Bank of Ireland (CBI) has imposed a significant fine of $24.75 million (€21,464,734) on Coinbase Europe Limited. This penalty addresses severe breaches in anti-money laundering (AML) and counter-terrorist financing (CTF) monitoring obligations that occurred between 2021 and 2025, marking the CBI's first enforcement action against a firm in the virtual asset service provider (VASP) industry.

Irish Regulator Imposes Significant Fine on Coinbase Europe

On Thursday, November 6, 2025, the Central Bank of Ireland publicly announced its decisive enforcement action against Coinbase Europe Limited, the European operational arm of the prominent US-based cryptocurrency exchange, Coinbase. The announcement detailed multiple failures by the company in adhering to crucial anti-money laundering and counter-terrorist financing monitoring requirements over a four-year period. This regulatory intervention underscores the increasing global pressure on crypto exchanges to establish and maintain rigorous compliance frameworks to combat financial crime effectively.

Details of the Enforcement Action

The settlement between the Irish regulator and Coinbase Europe was finalized on November 5, 2025. Initially, the penalty was set at $35.3 million (€30.6 million), but this figure was subsequently reduced to $24.75 million (€21,464,734) after the application of a 30% settlement scheme discount. Coinbase Europe has acknowledged the contraventions identified by the CBI and has agreed to the undisputed facts outlined in the Settlement Notice. The imposed sanctions are subject to confirmation by the High Court, after which they will become fully effective.

This penalty is a stark reminder to all financial institutions, especially those operating in the rapidly evolving fintech and crypto sectors, about the non-negotiable importance of regulatory compliance. The CBI's action sets a precedent for how virtual asset service providers will be held accountable for their obligations in safeguarding the integrity of the financial system against illicit activities.

Breaches in Anti-Money Laundering Protocols

The core of Coinbase’s regulatory infraction stemmed from significant "faults in the configuration of their transaction monitoring system." These systemic failures resulted in a staggering oversight where more than 30 million transactions were not properly monitored over a 12-month period. The cumulative value of these unmonitored transactions amounted to an alarming €176 billion, representing approximately 31% of all transactions processed by Coinbase Europe during the time these critical faults were active.

As a registered Virtual Asset Service Provider (VASP) in Ireland, Coinbase Europe is legally mandated to vigilantly monitor all customer transactions. Furthermore, the company is obligated to file a Suspicious Transaction Report (STR) with the national Financial Intelligence Unit (FIU) and Revenue Commissioners whenever there is a suspicion that a transaction might be facilitating money laundering or terrorist financing activities. The failure to adequately monitor such a substantial volume and value of transactions highlights a significant gap in their compliance infrastructure, potentially exposing the platform to exploitation by criminal elements.

Compounding the severity of the breaches, Coinbase’s European arm took nearly three years to fully complete the monitoring of the impacted 30 million transactions. This prolonged delay ultimately led to the submission of 2,708 STRs to the FIU for in-depth analysis and potential investigation, with many of these reports containing suspicions of serious criminal activities. The protracted timeline for remediation underscores a critical lapse in timely detection and reporting, which are fundamental pillars of effective AML frameworks.

Colm Kincaid, Deputy Governor of Consumer and Investor Protection at the Central Bank of Ireland, emphasized the gravity of these failures. "To be effective in combatting financial crime, law enforcement agencies rely on regulated financial institutions to have systems in place to monitor transactions and report suspicions. The failure of such a system within any financial institution creates an opportunity for criminals to evade detection – and criminals will take that opportunity," Kincaid stated. He further stressed the importance of prompt reporting of system failures to the Central Bank to enable immediate and appropriate risk management and mitigation strategies.

The Broader Context: US Scrutiny and Regulatory Stance

The regulatory challenges for Coinbase are not confined to Europe. Simultaneously, the company has been facing intense scrutiny in the United States. Recently, Senator Chris Murphy accused the cryptocurrency exchange of being involved in what he termed President Donald Trump’s alleged "corruption factory." The Democratic Senator suggested that Coinbase’s financial contributions to Trump’s presidential campaign might be part of a quid pro quo arrangement, potentially influencing the dismissal of the Securities and Exchange Commission (SEC)’s lawsuit against the exchange.

Coinbase's Defense and Advocacy for Clear Regulations

In response to Senator Murphy's allegations, Coinbase’s Chief Legal Officer (CLO), Paul Grewal, and Chief Policy Officer (CPO), Faryar Shirzad, strongly refuted the claims. Shirzad argued that the SEC’s lawsuits against Coinbase and numerous other crypto companies under the previous administration constituted "a grotesque pattern of bullying and abuse of power." Grewal echoed this sentiment, asserting that it was "corrupt" for the SEC to allow Coinbase to go public "in the public interest" only to initiate a lawsuit against it later. He also highlighted the Third Circuit's finding that the denial of Coinbase's request for clear crypto rules was "arbitrary and capricious."

Coinbase has consistently been a vocal critic of the previous US administration’s approach to cryptocurrency regulation, advocating for a more accommodating and clearly defined regulatory environment. Earlier this year, the exchange filed a Freedom of Information Act (FOIA) request to seek detailed information regarding the SEC’s expenditures on enforcement actions against crypto firms during the Biden Administration. This move underscores Coinbase's ongoing efforts to push for greater transparency and accountability in regulatory practices, contrasting with what it perceives as an aggressive and ambiguous regulatory crackdown on the crypto industry.

The enforcement action by the Central Bank of Ireland against Coinbase Europe serves as a potent reminder of the escalating global regulatory pressure on cryptocurrency exchanges. It reinforces the imperative for robust AML and CTF compliance mechanisms across the entire fintech sector. As the crypto industry continues to mature, adherence to stringent regulatory standards will be paramount for fostering trust, ensuring market integrity, and preventing financial crime on a global scale.