There is some good news at last. The Financial Action Task Force on Money Laundering (FATF) will release guidelines on how to regulate crypto businesses by June 21, according to a report by Bloomberg. The report stated that cryptocurrency exchanges, custodians and hedge funds will likely have to adopt new compliance measures as a result. These businesses are referred to by FATF as virtual asset service providers (VASPs).
A press release, published by the body said, “In accordance with Recommendation 1, countries should identify, assess, and understand the money laundering and terrorist financing risks emerging from virtual asset activities and the activities or operations of VASPs. Based on that assessment, countries should apply a risk-based approach to ensure that measures to prevent or mitigate money laundering and terrorist financing are commensurate with the risks identified. Countries should require VASPs to identify, assess, and take effective action to mitigate their money laundering and terrorist financing risks.”
This already looks promising as the recently concluded G20 Summit where India was a participant took up an oath to follow the guidelines to abide laid down by the FATF.
At the summit, nations from around the globe took an oath that said, “We reaffirm our commitment to applying the recently amended FATF Standards to virtual assets and related providers for AML and CFT. We look forward to the adoption of the FATF Interpretive Note and Guidance by the FATF at its plenary later this month. We welcome IOSCO’s work on crypto-asset trading platforms related to consumer and investor protection and market integrity. We welcome the FSB’s directory of crypto-asset regulators, and its report on work underway, regulatory approaches and potential gaps relating to crypto-assets.”
The combination of amended FATF guidelines and the G20 resolution means that no country will be able to ban sale and purchasing of cryptocurrencies, right out of hand. They will have to do due diligence, before they take any step.
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