A new study has revealed that the crypto industry is committed to complying with the so-called travel rules issued by the Financial Action Task Force (FATF) and appears to be ready to work with regulators to speed up the process.
According to a survey conducted by Notabene, a New York-based crypto-compliance company, the majority of the crypto-industry will comply with the travel regulations by the second quarter of 2022. The report currently claims that around 70% of respondents either meet the requirements. with the rule or plans to complete compliance in the first / second quarter of 2022.
The emergence of cryptocurrencies has created a new challenge in the fight against money laundering and terrorist financing. Since 2014, the Financial Action Task Force on Money Laundering (FATF) has monitored this area to set standards for dealing with these new risks. Since then, the FATF has continued to adjust and refine its position on anti-money laundering requirements in the cryptocurrency sector to keep pace with rapid developments.
FATF Wire Transfer Recommendation No. 16, also known as the Travel Rule, states that providers of virtual asset services (VASPs), financial institutions and other regulated entities in the member states must provide issuer and recipient details to their counterparties in transactions worth USD 1000 and more.
The survey involved 56 companies from around the world, with 45% in Asia Pacific, 30% in Europe, the Middle East and Africa, and 25% in North America. 13% of respondents have a banking or banking license; 86% of original companies are cryptocurrencies.
According to the survey, about a third of the companies (31%) follow the rules in whole or in part. The report also showed that 92% of the respondents have internal and legal compliance departments, and 78% of these companies believe that these teams can ensure that the company operates in accordance with external rules and internal control.
What is the timeline for your business to achieve full compliance with travel regulations? Source: Notabene
About the topic: Governments are starting to implement the FATF’s travel rules around the world
On the other hand, half of the respondents indicated that the imposed barriers to travel included an early period and legal uncertainty about the aspects most relevant to adoption. According to the report, the majority of respondents (46%) were not familiar with the protocol they intended to use to comply.
In 2019, the Financial Action Task Force (FATF) published a set of rules, including a travel rule, to prevent the use of cryptocurrencies for money laundering and terrorist financing. Japan has been one of the jurisdictions most receptive to the travel regulation system, along with other Asian countries such as South Korea and Singapore.