FATF Upset, Worried About Nations Being Slow in Regulating Crypto

The Financial Action Task Force (FATF) has voiced concerns about the lack of national implementation of the regulations it established to govern the virtual digital asset industry. According to a FATF analysis, there is an opportunity for illegal activity to flourish because of the delay in implementing and approving certain regulations pertaining to cryptocurrency. The organisation created a list of countries with the regulations that each one has enacted after analysing data spanning a full year.

A plan to improve the application of the FATF Standards on virtual assets and virtual asset service providers (VASPs) was approved by the FATF Plenary in February 2023. The FATF stated in an official article that “many countries have not yet fully implemented the FATF’s requirements on virtual assets and virtual asset service providers to prevent their misuse for illicit finance.”

The global financial watchdog, with its headquarters in Paris, has been working to find solutions for problems relating to criminals using cryptocurrency assets for money laundering or financing terrorism. In order to avoid being “grey listed,” the FATF informally mandated in November 2022 that nations adhere to its anti-money laundering (AML) laws.

The FATF has mandated that all nations only permit licenced enterprises to deal with cryptocurrency assets, among other regulations. FATF has also directed countries to gather information about cryptocurrency asset senders and recipients, particularly regarding transactions that appear suspicious. The countries that have or have not met the requirements set forth by the FATF regarding cryptocurrency activity are indicated on the list that the organization has put together.

It appears that India has implemented all of the FATF’s regulations. On the other side, certain countries, like Australia, Finland, Greece, Malaysia, and Portugal, are still implementing FATF regulations.

Because virtual assets are by nature multinational and borderless, they can have major worldwide repercussions if they are not regulated in one country. This is very worrisome, as the group stated. The FATF network will be able to encourage governments with materially relevant VASP activity to completely and promptly implement Recommendation 15, thanks to the purposes of this table.