The Financial Action Task Force (FATF) recently convened from June 14 to June 17 and finalized a targeted update on the implementation of the FATF requirements for virtual assets and virtual asset service providers (VASPs).
This was the last plenary of the organization under the German Presidency of Dr. Marcus Pleyer.
The key outcomes regarding virtual assets and the crypto industry are:
- The Netherlands lacks in terms of regulation of virtual asset service providers.
- A report on the crypto industry will be published at the end of June. The report will focus on the misuse of virtual assets and VASPs for money laundering, and the financing of terrorism and proliferation.
The FATF Travel rule will be reported at length in the update. The Travel Rule requires VASPs to collect or send information on the identities of the originator and beneficiary with virtual asset transfers.
The report will highlight the progress of various countries in relation to the Travel Rule.
The report will also stress the urgent need for jurisdictions across the world to implement and enforce the travel rule.
Finally, the report will provide information about the emerging risks and market developments in the sectors of DeFi, NFTs, and unhosted wallets.
The FATF previously released guidelines for the crypto industry in October of 2021. The majority of the guidelines were for centralized exchanges and platforms but didn’t provide much clarity on the DeFi front.
