UN Task Force Rallies Again For Crypto 'Travel Rule' To Stem Money Laundering, Terrorism Financing

The United Nations Financial Action Task Force (FATF) has once again called on countries to implement the “travel rule” in order to combat money laundering and terrorism financing associated with cryptocurrencies.

What Happened: In a recent post, the global body expressed disappointment that “many” of its member states have not adopted the rule, despite holding meetings in Paris. A survey conducted by the FATF revealed that over half of the respondents have taken no action to implement the Travel Rule, which is a crucial requirement.

In response, the FATF is urging countries to promptly introduce measures to address anti-money laundering and counter-terrorism financing related to crypto activities. They aim to close significant loopholes that have enabled criminal behavior.

See Also: Bitcoin Clings To $30K, Ethereum, Dogecoin Dip Despite SEC Nod For Crypto Futures ETF

The travel rule, also known as FATF Recommendation 16, consists of guidelines aimed at combating money laundering and terrorist financing. It mandates the identification of individuals involved in cryptocurrency transactions to verify their identities and detect potential criminal activity.

The rule applies to financial institutions and crypto firms involved in the transfer of virtual assets, collectively referred to as VASPs.

Why It Matters: The FATF conducted a survey in March 2022, which revealed that only 29 out of 98 jurisdictions had implemented the Travel Rule requirements, with few enforcing penalties for non-compliance. The upcoming FATF report, to be published on June 27, will also address North Korea’s alleged illicit virtual asset activities and consider other emerging risks such as decentralized finance, non-fungible tokens (NFTs), stablecoins, and peer-to-peer transactions.

Price Action: Bitcoin BTC/USD was trading at $30,207 at the time of writing, showing a 1.61% decrease in the last 24 hours, according to data from Benzinga Pro. 

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