G-7 Urged to Regulate Cryptocurrency: FATF Recommendations and Global Compliance

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The president of the Financial Action Task Force (FATF), Raja Kumar, has called upon the G-7 finance ministers to address the issue of cryptocurrency regulation and implement the FATF recommendations. The FATF’s proposals aim to tackle money laundering, terrorist financing, and prevent any virtual safe havens for unlawful financial transactions.

Among these recommendations is the travel rule, a requirement for cryptocurrency service providers to share certain information about transactions to minimize misuse by criminals and terrorists. Kumar believes that G-7 countries, being some of the world’s seven most influential economies, should lead by example and regulate the crypto sector accordingly, as stated in a recent Twitter post.

While countries have made progress in implementing the FATF’s standards, compliance with updated cryptocurrency requirements remains disappointingly low. In 2019, the FATF extended its global anti-money laundering and countering terrorist financing standards to include crypto assets. However, a staggering 73% of countries, including certain G20 nations, have yet to supervise crypto activity and still only partially comply with the FATF Standards. Kumar insists that this unsatisfactory state of affairs must be urgently addressed.

The timing of Kumar’s remarks is notable, as the G-7 will be meeting this weekend to discuss an array of pressing matters, potentially including cryptocurrency regulation. During a previous summit, the G-7 collectively voiced their commitment to regulating crypto-assets and expressed anticipation regarding the Financial Stability Board’s (FSB) finalization of high-level recommendations by July 2023.

The FSB, an international advisory body created by the G20, presented its proposals for cryptocurrency regulation in October 2022. The risks associated with inadequate regulation of the sector continue to grow, with ransomware payments nearly always involving crypto as their primary currency. Kumar urges countries to take immediate action in order to eliminate the lawless spaces that enable criminals, terrorists, and rogue states to exploit crypto assets for illicit purposes.

In conclusion, the FATF president’s call for action highlights the need for G-7 nations to take the lead in regulating the booming cryptocurrency industry. By implementing the FATF recommendations and addressing the unfavorable circumstances surrounding crypto, these influential countries

Source: Cryptonews

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