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FATF President T. Raja Kumar said G7 member states must set an example in implementing global standards for dealing with the crypto industry, adding it is necessary to put an “end to the lawless crypto space.”
The head of the Financial Action Task Force (FATF) has urged G7 nations to set an example in implementing global anti-money laundering standards. Kumar added it is prudent to put an “end to the lawless crypto space” as little progress has been made in introducing the organization’s new crypto rules.
The FAFT head urged the Group of 7 to implement recommendations on fighting against money laundering and terrorism ahead of the annual G7 summit in Hiroshima, Japan, this weekend.
“G7 countries should lead by example and regulate the crypto sector so that no safe havens exist for illicit crypto transactions”#FATF President T. Raja Kumar´s message to #G7 leaders ahead of the summit in Japan— FATF (@FATFNews) May 18, 2023
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CBDCs and “Travel Rule” Up for Discussion at Hiroshima
The summit is slated to discuss policy for crypto and digital assets and standards for the global implementation of central bank digital currencies (CBDCs). The summit will also address accelerating the implementation of the FAFT’s controversial “Travel Rule.”
The “Travel Rule” requires financial institutions which process crypto transfers greater than $3,000 to disclose the sender’s details, including their name, address, and account information.
Kumar said most countries have advanced in introducing regulation, with most introducing FATF standards, but “relatively poor” progress had been made in implementing the updated requirements relating to crypto assets. The President noted his concerns in an article entitled “An End to the Lawless Crypto Space.”
G7 countries should lead by example and regulate the crypto sector so that no virtual safe havens exist for illicit financial transactions.
The FATF applied its AML and counter-terrorist financial rules to the crypto space in 2019, but most nations remain non or only partially compliant with them.
Kumar further emphasized the increased risk of crypto assets as they grow. He specifically referenced the use of cryptocurrencies to pay for ransomware attacks and evade sanctions and its use in raising funds for terrorist groups.
“While the risks have increased, crypto assets continue to operate in a virtually lawless global environment,” the FAFT President said.
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