The Financial Action Task Force (FATF), a powerful global financial watchdog, seems to start a new war against the crypto industry. In the meantime, 73% of all countries have implemented the FATF Travel Rule, which requires that crypto service providers request a lot of data from users.
The purpose of this is mainly to prevent money laundering, but for the individuals in question, sharing that data can sometimes cause other problems.
FATF focuses spotlights on stablecoins and Defi
In FATF’s new annual report, it focuses on Stablecoins and Decentralized Finance (Defi). The financial watchdog is still very concerned about its increasing use, including North Korean hackers.
The organization indicates that it has plans to publish targeted papers about stablecoins, offshore crypto platforms and Defi for the following summer. With that it already gives a hints about the legislation that we can expect below.
How Fatf became the backbone of crypto legislation
The Travel Rule of FATF was expanded in 2019 to also cover cryptocurrencies and exchanges. Of the 138 jurisdictions that fall under FATF, only one has succeeded in working in line with the R.15 rules. In the meantime, 40 jurisdictions are “largely” compliant with the rules.
Compliance with the rules means that a jurisdiction has laws that contain a license or registration obligation for crypto fairs and trading platforms.
According to FATF, there are two ways to determine how the crypto sector is treated: Allow or prohibit. In particular in the Middle East and North Africa, overall prohibited are popular.
At FATF, however, they warn of a general ban. “If jurisdictions opt for a general ban, instead of regulating crypto, they do not eliminate their presence within their limits. Instead, they give supervision to, they have no ways to intervene, and no insight into illegal flows,” said Hedi Navazan of Fatf.
Source: https://newsbit.nl/fatf-begint-nieuwe-oorlog-tegen-crypto-industrie/
