FATF worries countries are slow to regulate cryptocurrencies: Details

The Financial Action Task Force (FATF) has expressed concern that not many countries are enforcing the rules it has set to regulate the virtual digital asset industry. In a report released by the FATF, delays in the deployment and adoption of these cryptocurrency-related rules have left room for criminal activity to develop. The organization analyzed 12 months of data to prepare a list of countries detailing the rules each country has adopted.

“In February 2023, the FATF Plenary agreed on a roadmap to strengthen the implementation of the FATF standards on virtual assets and virtual asset service providers (VASPs). Many countries have yet to fully implement the FATF standards on virtual assets and virtual asset service providers requirements to prevent its misuse for illegal finance,” the organization said in a statement. Official post.

The Paris-based global financial regulator has been grappling with issues related to the misuse of crypto assets by criminals for money laundering or terror financing. As early as November 2022, the FATF informally asked countries to comply with its anti-money laundering (AML) regulations to avoid being included in the “grey list.”

Among other rules, the FATF directed all countries to only allow licensed companies to handle crypto assets. The FATF also instructs countries to collect details about senders and recipients of crypto assets, especially details of suspicious transactions. In the list compiled by the FATF, it marks countries that have or have not yet met certain criteria set by the FATF around cryptocurrency activities.

These standards include conducting risk assessments, developing licensing systems, and supervising and inspecting VASPs.

“Virtual assets are inherently international and borderless, which means that failure to regulate VASPs in one jurisdiction could have serious global implications. This is particularly concerning,” the group said. “The purpose of this form is to enable the FATF Network to encourage jurisdictions with significant VASP activity to fully implement Recommendation 15 in a timely manner.”

India seems to have adopted all the rules laid down by the FATF. On the other hand, some countries such as Australia, Finland, Greece, Malaysia and Portugal are still in the process of deploying FATF rules.

Ashish Singhal, co-founder of India’s CoinSwitch cryptocurrency exchange, responded to FATF’s concerns.

“We commend India for its proactive approach in conducting risk assessments for VASPs and implementing travel rules. India’s mutual evaluation was conducted last year and a plenary discussion is likely to be held in June this year,” Singhal said in a report wrote. LinkedIn Post.