Nearly Half of Jurisdictions Still Not Applying Crypto Laundering Norms, Global Regulator Says

The Financial Action Task Force has vowed to toughen its monitoring, though some fear customer identification rules could harm online privacy.

AccessTimeIconApr 19, 2022 at 1:00 p.m. UTC
Updated May 11, 2023 at 6:32 p.m. UTC

Nearly half of jurisdictions worldwide still aren’t requiring crypto providers to identify their customers properly, money laundering watchdog the Financial Action Task Force said in a report released Tuesday.

The Paris-based international organization vowed to step up monitoring of its members, which include the U.S., European Union and China, with more frequent assessments focusing on where illicit funding risks are highest.

Nine percent of jurisdictions are not compliant with norms requiring virtual asset service providers (VASP), such as wallet providers and exchanges, to ensure funds aren’t being used to launder money or finance terrorism, the report said.

Also, 37% are merely partially compliant, putting the crypto sector near the bottom of the league table alongside risky non-financial businesses such as law, accounting and real estate.

International money-laundering norms were updated in 2018 to make allowance for virtual assets, which some have feared could present a loophole to laws regarding sanctions and other financial restrictions.

Those standards are currently being implemented in jurisdictions such as the EU, which is extending the FATF rules in ways which critics say could diminish privacy and stifle innovation.


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Jack Schickler

Jack Schickler was a CoinDesk reporter focused on crypto regulations, based in Brussels, Belgium. He doesn’t own any crypto.