The Financial Action Task Force, FATF, has released an initial update of its guidance on bitcoin, cryptocurrencies, and digital asset service providers. In one of its divisions, the entity proposes to prohibit transactions to and from private wallets (self-custodians) in the case of peer-to-peer or P2P transactions.
According to the organization that fights money laundering and terrorist financing, states must do so Understand the “risks” of operations of this nature. In the interest of countries that take measures to “mitigate” P2P, the FATF proposal is to reduce it.
The guideline proposes textually “Deny licensing to Digital Asset Service Providers (VASPs) if they allow transactions to / from non-binding entities (ie private / non-hosted wallets) to accept transactions only to / from other service providers. My digital assets”.
The foregoing indicates that traders can only transact within Bitcoin exchanges, for example, or between several exchanges. Potential ban Merchants Not withdrawing their money to their own wallets, but leaving it in the exchange or transferring it between them.
In theory, that wouldn’t happen either Sending money from this wallet to the exchange, This is compliance with the so-called “travel rule”. According to the rule, exchanges must exchange information about those users who transact over $ 1,000.
The idea is for VASPs to know at all times where the performed transactions are coming from and where they are going. According to the FATF, this dynamic can be hindered by, for example, specific wallets that each user has on their phone.
FATF Centralized Bitcoin Supervision
For Scott Group, director of the Association of Anti-Money Laundering Professionals (ACAMS), the guidelines the FATF has implemented in the past and the ones it is proposing this time are “far from the complete solution the industry needs”. According to Group, this is another attempt by moderators to “get the case under control.”
Citing via digital means, the director explained that the approach that Group implementation attempts are based on central control or monitoring. The purpose of the FATF is to bring the magnifying glass of financial operations closer to “all parties likewise, regardless of technology.”
Scott Group believes the FATF proposals will deepen centralized oversight of Bitcoin. Source: ACAMS / digitellinc.com
On Twitter user Peter Slagter (Embed a TweetHe posted that the FATF draft is an ongoing war on criticism and privacy. “It was presented as optional, but it’s still a villain.”
CriptoNoticias announced three weeks ago that FATF would provide a stricter guide to cryptocurrencies and service providers linked to Bitcoin. This draft is an update of the organization’s guidance to malicious actors not to launder money or finance terrorism using cryptocurrencies.
The FATF was created in 1989 and consists of about 40 countries. Since then, it has formulated recommendations and standards to reduce money laundering and terrorist financing. It does not advertise laws, but rather guidance that each country may or may not adapt its domestic laws.