The G20 group of nations has reaffirmed it will align with standards for anti-money laundering (AML) and countering the funding of terrorism (CTF) set to be finalized by the Financial Action Task Force (FATF) this month.
Finance ministers and central bank governors from the G20, who met in Fukoka, Japan, over the weekend, made the commitment to applying the rules in a communique published on the website of the Japanese Ministry of Finance on Sunday.
The FATF standards are expected to set tough operating procedures for crypto exchanges, going beyond the basic “know your customer” (KYC) rules that most major exchanges now abide by. In addition to verifying and keeping records of their users’ identities, exchanges and other service providers would have to pass customer information to each other when transferring funds, just as banks are required to do – a procedure known in the U.S. as the “travel rule.”
The G20, however considers the threat from crypto assets low, and recognizes their potential. The group said in the communique:
It's also seeking possible additional measures, calling for the Financial Stability Board (FSB) and "other standard setting bodies to monitor risks and consider work on additional multilateral responses as needed." The G20 welcomed the FSB's directory of crypto-asset regulators, published in April, and its report on ongoing work, regulatory approaches and potential "gaps" in crypto-asset regulation.
Finally, addressing the issue of hacks in the crypto space, the G20 said:
Japanese flag image via Shutterstock
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.