The recent G20 meeting of world leaders in Osaka, Japan has brought some regulatory action in the cryptocurrency sector. The G20 countries, which includes some of the most important crypto countries like the US, South Korea, Japan, and China, indicated their support for new guidelines that will make digital currency exchanges submit user data to regulators.
Following the FATF Guidelines
The Financial Action Task Force published a set of proposed guidelines for nations to combat the issue of money laundering and ‘washing’ of crypto funds. The FATF recommended that regulators should oversee cryptocurrency exchanges and services and adopt a risk-based approach to tackle money-laundering related to digital coins. Virtual currency service providers must obtain and hold information about their account holders and send them to the authorities, especially in case of suspicious transactions.
The exchanges will be required to gather information about the sender including name, wallet address, physical address, and date of birth. They should also know the beneficiary account number; wallet addresses national identity number and date of birth.
Bringing Financial Industry Standards to Crypto
The G20 said that following the new guidelines reiterates their commitment to implement the standards suggested by the FATF. They noted, “Technological innovations can deliver significant benefits to the financial system and the broader economy. While crypto-assets do not pose a threat to global financial stability at this point, we are closely monitoring developments and remain vigilant to existing and emerging risks.”
As the G20 countries have accepted the FATF guidelines, they may soon draft laws in their respective jurisdictions along these lines.
While the G20 meeting was in session, a group of crypto service providers signed an MoU to collaborate with regulators to help create policies that govern the crypto industry. The group includes blockchain and cryptocurrency associations from Japan, South Korea, Singapore, Taiwan, and Hong Kong.