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FATF Puts Some Pressure off the Crypto Industry

FATF Puts Some Pressure off the Crypto Industry

Tom Neylan, head of the Policy Development Group within the Secretariat of the FATF, at the V20 Summit. Source: Twitter, @TeanaTaylor

It seems that the Financial Action Task Force (FATF), a multi-government body, that scared the crypto industry with its new guidance, now tries to calm the companies down.

The news arrived from the V20 Summit in Osaka, where executives from major crypto companies such as Circle, Coinbase, bitFlyer, Kraken, Huobi and others gathered to discuss regulatory challenges. Also, various government agencies, regulatory and regional legislative representatives, as well as former FATF President Roger Wilkins are attending the event.

“Today, Tom Neylan, head of the Policy Development Group within the Secretariat of the FATF, said that the new FATF rules take effect immediately but the FATF recognize that it will take time to implement within local jurisdictions,” according to the spokesperson for the event, Leah Callon-Butler.

She added that, according to Neylan, the private sector should not fear that they will have to act before they properly understand and digest what the new requirements are, and that national supervisors should be reasonable about when they expect the changes to be fully implemented.

At the two-day event that takes place alongside the G20 Summit in Osaka and ends on June 29, Saturday, virtual asset service providers (VASPs) are discussing how the new requirements could be implemented “while also protecting and promoting the interests of business.”

For example, according to the spokesperson, the application of some of the new requirements could potentially encourage peer-to-peer transfers via non-custodial wallets.

“[They] are significantly harder for law enforcement to track or control, ultimately reducing the prevalence of exchanges themselves, which are currently one of the most effective forms of prevention and partnership to law enforcement working in the virtual asset sector,” she told Cryptonews.com.

Meanwhile, according to some of the participants of the event, the new rules present opportunities also.

“As we see it, these measures simply extend the same rules to VASPs that the rest of the global financial community already abides by. While it’s true these changes do present a challenge to the industry in terms of immediate implementation, they present real opportunities as well,” Huobi Global CEO Livio Weng said.

He went further to explain that this is a chance to develop industry standards to promote growth and protect user rights, develop technology to identify and weed out the bad while preserving the access for legitimate users, “and to develop our ability to respond as a community to the issues that the cryptocurrency and blockchain industries face.”
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As reported last week, the FATF agreed to implement their previous recommendations that would force governments to tighten oversight of the crypto business. Also, countries will be compelled to register and supervise all crypto-related businesses, including hedge funds, exchanges, custodian services, which will have to check their customers and report suspicious transactions. The FATF will monitor implementation of the new requirements by countries and service providers and conduct a 12-month review in June 2020.

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