The Governments of the Group of Twenty (G20) countries – which includes the European Union – have lent support for guidelines on cryptocurrency regulations suggested by money-laundering watchdog the Financial Action Task Force (FATF).
FATF, an intergovernmental organization aimed at combating financial crimes such as money laundering and the funding of terrorism, took its initiatives – developed over six days of plenary meetings in mid-June – to this weekend’s G20 summit held in Osaka, Japan.
Travel Rule Controversy
The guidelines proposed by FATF included the much-debated “travel rule” that requires digital asset exchanges to collect and transfer customer information during transactions. Critics of the travel rule have said adherence would require unwieldy levels of collaboration and would be costly to implement.
Privacy was also at the forefront of concerns: Joseph Weinberg, blockchain advisor at the Organisation for Economic Co-operation and Development told CryptoGlobe last month that implementing the travel rule could become a “huge privacy issue”. He questioned how transaction details and identity data could be ensured to be kept secure.
G20 Leaders Declaration
In its closing statement the G20’s leaders declaration admitted that technological innovations can deliver significant benefits to the broad economy. On cryptocurrencies specifically, however, it remained cautious:
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. We welcome on-going work by the Financial Stability Board (FSB) and other standard setting bodies and ask them to advise on additional multilateral responses as needed.
On accepting the FATF guidelines on anti-money laundering and other financial crimes, the statement added:
We reiterate our strong commitment to step up efforts to fight these threats, including by strengthening the FATF’s global network of regional bodies. We call for the full, effective and swift implementation of the FATF Standards.
Some critics took to social media websites to express their opinions of the guidelines. Among them, Daniel Kelman said on Twitter:
Just finished two days of discussions with FATF over AML rules for exchanges. It is clear FATF does not understand our industry and are just applying ill-fitting rules from the banking industry. FATF says these rules will not change, but we will see about that #V20Osaka
— Daniel Kelman (@danielkelman) June 29, 2019