G20 countries have agreed to regulate cryptocurrencies in line with Financial Action Task Force (FATF) standards at the second session of the summit held in Buenos Aires, Argentina.
‘We will regulate crypto-assets for anti-money laundering’
On Saturday, a joint declaration was officially signed by all G20 nations, reports The Saudi Gazette. The document acknowledges that “necessary reform” is required given the blistering pace of the “digitalization” of the global economy.
In relation to cryptocurrencies or “crypto-assets” as they are referred to in the document, the G20 has agreed to a regulatory approach in line with FATF standards. Section 25 of the official declaration reads:
We will regulate crypto-assets for anti-money laundering and countering the financing of terrorism in line with FATF standards and we will consider other responses as needed.
In addition, the countries will work together and monitor the digitization of the global economy that’s happening at a rapid pace. An excerpt from section 26 reads:
We will continue to work together to seek a consensus-based solution to address the impacts of the digitization of the economy on the international tax system with an update in 2019 and a final report in 2020.
CryptoPrimacy reported last week that the U.S. has taken the first-ever action against two Iranian ransomware “facilitators.” The U.S. Treasury’s Office of Foreign Assets Control (OFAC) published two Bitcoin wallet addresses warning the cryptocurrency and financial communities that anyone transacting with the accused could be subject to secondary sanctions.
However, it still doubtful that these measures will be successful in preventing Bitcoin and cryptocurrency transactions at the protocol level. In fact, Bitcoin was intentionally designed to be censorship resistant, borderless and politically nuetral form of money.
G20: India Urges to Combat ‘Fugitive Economic Offenders’
India appears to have spearheaded the initiative Friday, presenting a nine-point list urging the G20 countries to combat “fugitive economic offenders” which also includes crypto-assets such as Bitcoin and other cryptocurrencies, as The Hans India reports.
The agenda was presented by Indian Prime Minister Narendra Modi, who called for the FATF to assign priority and establish international cooperation. This would ensure that member countries work closely and respective financial intelligence units share information required to track down offenders.
“FATF should be tasked to formulate a standard definition of fugitive economic offenders. FATF should also develop a set of commonly agreed and standardized procedures related to identification, extradition and judicial proceedings for dealing with fugitive economic offenders to provide guidance and assistance to G20 countries, subject to their domestic law,” the agenda read.
According to the FATF website:
The Financial Action Task Force (FATF) is an inter-governmental body established in 1989 by the Ministers of its Member jurisdictions. The objectives of the FATF are to set standards and promote effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and other related threats to the integrity of the international financial system. The FATF is, therefore, a “policy-making body” which works to generate the necessary political will to bring about national legislative and regulatory reforms in these areas.
Earlier in July, CryptoPrimacy reported on the first session held in Buenos Aires, where the member states stopped short of establishing a regulatory framework. Nevertheless, the G20 did concede that “crypto-assets can deliver significant benefits” and do not pose a risk to global financial stability. However, the members agreed to monitor their progress and develop a comprehensive regulatory approach in the near future, citing concerns with tax evasion and money laundering.
“Crypto-assets do, however, raise issues with respect to consumer and investor protection, market integrity, tax evasion, money laundering, and terrorist financing,” the report read. “Crypto-assets lack the key attributes of sovereign currencies. While crypto-assets do not at this point pose a global financial stability risk, we remain vigilant.”
Will the G20 countries succeed in regulating cryptocurrencies based on FATF standards and global cooperation? Share your thoughts below!
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