- The FATF has announced that new laws regarding cryptocurrency will be released next year.
- The laws are geared towards preventing money laundering.
- Countries that do not comply risk being put on a blacklist.
One of the biggest issues related to cryptocurrency adoption is the potential use of the tech for fraud and other illegal activities.
As digital currencies become more commonplace, a number of bodies are looking to put laws in place to ensure that they cannot be used for crime.
One of these organizations is the Financial Action Task Force (FATF). The FATF is a Paris-based organization that combats financial crimes.
According to recent reports, the FATF will be issuing their own set of guidelines by the middle of 2019.
The effect of this will be regulations put in place to guide cryptocurrency exchanges and wallet providers. Due to the nature of cryptocurrency, it can be used for money laundering, which the FATF is trying to avoid.
FATF amends its global Standards to address the regulation of virtual assets and prevent their misuse for #moneylaundering and #terroristfinancing
➡️https://t.co/R5R7j484Td pic.twitter.com/mOqeY25aJd— FATF (@FATFNews) October 19, 2018
Ripples
While some cryptocurrency enthusiasts argue that external regulations defeat the purpose of cryptocurrency in the first place, regulations like this might be essential if crypto is to be widely adopted.
Some of the general public still does not trust cryptocurrency, seeing it as either a fad or a dangerous internet concept. By introducing laws like this, public confidence is gained and institutional acceptance is more likely.
When these laws are issued next year, the FATF will monitor the countries that adopt these laws. Those that do not risk being put on a blacklist, says the President of the FATF, Marshall Billingslea.
“By June, we will issue additional instructions on the standards and how we expect them to be enforced,” He said.
Changing Times
The issuing of these laws might be a bit tricky as several countries and states already have laws put in place regarding cryptocurrency.
Countries like Malta have extremely favorable cryptocurrency laws while places like California outright ban the use of crypto for certain purposes.
These new laws might, if adopted, require the ones already in use to be changed in some places and this might prove quite taxing for some governments.
