International anti-money laundering watchdog, The Financial Action Task Force (FATF), is open to amend the so-called ‘Travel Rules’, which guide the countries in imposing regulations on the cryptocurrency industry.
The body first published the recommendations in June 2019 and will now accept feedback and consultation towards the amendment of the rules, Thursday’s announcement detailed.
“The FATF has agreed to release an update to the FATF guidance for virtual assets and VASPs for public consultation,” FATF stated.
The updated guidance will focus on some specific areas, including the implementation of FATF-standards on stablecoins, ways public and private companies can implement Travel Rule and ways to mitigate risks of peer-to-peer transactions.
Further, the US Treasury department elaborated on the willingness of the intergovernmental organization towards amending the rules, which are often criticized by the cryptocurrency industry to be too harsh.
“The updated guidance will help countries and VASPs understand their obligations and effectively implement the FATF’s requirements in key areas, including how the FATF Standards should be applied to stablecoins, travel rule implementation and how to address the risks of peer-to-peer transactions,” the Treasury Department said.
Harsh, Yet Necessary Recommendations
After the inception of cryptocurrencies, they soon became the favorites of criminals and a handy tool for money laundering and illegal financing. However, regulating the space remains hard.
The FATF’s recommendations include maintenance of user data by the cryptocurrency exchanges for all transactions above a certain threshold. Many jurisdictions have introduced crypto regulations up to a certain level based on these recommendations, even some crypto companies have become FATF compliant.
“We are now consulting on updated guidance on progress within the virtual assets sector, including the travel rule,” FATF President Dr Marcus Pleyer said in a press briefing. “We hope to get feedback from the key industry players…and I’m confident that we will approve it in June so that it can then be handed out to the industry after that.”