Financial Action Task Force (FATF) Seeks New AML Cryptocurrency Standard Agreement
The Financial Action Task Force is an organization that includes multiple governments that aim to reduce the risk of money laundering through their regulations and protocols. The organization was founded in 1989, and their most recent development seems to be the goal of creating a set of standards that concern cryptocurrency. This new endeavor has received optimistic support from President Marshall Billingslea, as October sessions are schedule to review the AML methodology presently in place.
The task force has been dedicating the last few weeks of energy into finding a general consensus on this recent matter of emergency, which was classified as such by the G20. The goal is to eliminate the “gaps” in the regulations that have developed as a result of virtual currency. Billingslea said, “It is essential that we establish a global set of standards that are applied in a uniform manner.”
Right now, Billingslea is calling the standards that the virtual space is run by “very much a patchwork quilt or spotty process,” which is “creating significant vulnerabilities for both national and international financial systems.”
This issue is a prevalent discussion within the UK right now, as the parliament is working to regulate these “Wild West” crypto-asset markets. By establishing regulatory framework, it actually becomes possible to protect consumers from the risks that they would otherwise be subjected to within the crypto community. These concerns were voiced by the Commons Treasury Select Committee.
Though there are many cryptocurrency ventures that are being adapted for cybercriminal use and terrorism organizations, Billingslea recognizes the “great opportunity” that they afford the public. It will be important for the regulators in the market to beware “tilt[ing] too far in one direction or another,” making room for the technology to “continue to evolve.”
In a report from Europol that happened about seven months ago, it was exposed that $5.5 billion had been laundered by criminals in Europe. The local policing agency has since urged the regulators to establish a centralized system that takes note of any crypto wallet involved in a criminal activity, giving them the chance to block the address.
As cryptocurrency continues to expand, authorities around the world seem to be scrambling to correct and update their anti-money laundering efforts, but the technology is getting harder to work with. Decentralized exchanges are the most likely to see growth and to evolve into mainstream use, which means that the Financial Action Task Force will need to address new gaps again soon.