FATF Opens Amending Crypto Travel Rule Guidance

[Cordillerabit]

The Financial Action Task Force (FATF) is open to amending its guidelines for cryptocurrencies and companies providing services in space to the "travel rule."

The anti-money laundering watchdog said Thursday that it is confident that the crypto industry will be able to implement complicated requirements for data sharing, colloquially known as the "Travel Rule," by the time of its 12-month review in June this year.

Nevertheless, a statement from the U.S. Treasury Department stated that FATF "agreed to seek public consultation on amendments to" the June 2019 guidance.

"The updated guidance will help countries and VASPs understand their [anti-money laundering/countering terrorism financing] obligations and effectively implement FATF requirements in key areas, including how to apply FATF standards to stable coins, the implementation of travel rules and how to address the risks of peer-to-peer transactions," the Treasury Department said.

The announcements on Thursday came after a virtual plenary meeting, where officials from FATF member states met to discuss ongoing efforts to monitor or mitigate money laundering concerns and assess whether any nations were failing to comply with the guidance of the standard-setters.

The FATF has previously indicated that progress has been made in the virtual asset industry, but has also "revealed the need for more guidance on the implementation of the revised requirements, including for low-capacity countries," according to a statement accompanying the plenary meeting this week.
 
FATF President Dr. Marcus Pleyer was asked during a post-Plenary press briefing if any leniency would be shown to countries that might be slow to implement the Virtual Asset Service Providers (VASPs) recommendations in those jurisdictions. (This expected disparity in regulatory compliance is referred to as the' sunrise problem' from one jurisdiction to the next.)

We are now consulting on updated guidance on progress, including the travel rule, within the virtual assets sector," Player said." "We hope to receive feedback from key players in the industry [...] and I am confident that in June we will approve it so that it can then be passed on to the industry after that."

The FATF has now updated its guidance on specific areas, including how to apply FATF standards to so-called stable coins, how the travel rule can be implemented by the public and private sectors, and how to address the risks of disintermediated peer-to-peer transactions, the statement said.

The public consultation draft will be published in March by the FATF, it said. The final guidance which the FATF expects to approve in June 2021 will be informed by feedback from the consultation.

Source: Bityard