FATF revised review of VASP regulation

[Nishizawa]

https://www.fatf-gafi.org/media/fat...vised-FATF-Standards-Virtual-Assets-VASPS.pdf

The Financial Action Task Force's latest mission… Global Stablecoins - CityAM


It said "
The lack of explicit coverage of peer-to-
peer transactions via private / unhosted wallets was a source of concern for a number
of jurisdictions. Jurisdictions noted that transfers to the unregulated peer-to-peer
sector could present a leak in tracing illicit flows of virtual assets. (...)
This includes banning or denying licensing of platforms if they allow unhosted wallet
transfers, introducing transactional or volume limits on peer-to-peer transactions or
mandating that transactions occur with the use of a VASP or financial institutions. "


Finally, FATF started to consider banning peer to peer trading. Maybe we won't able to use private wallet in the future.

 

[khinkali]

Thanks for the link @Nishizawa

They want to put a ring around regulated (i.e. all) virtual asset service providers. So you can transact between regulated entities, but not outside.

Imagine walking into your bank branch. "I'd like to take my money out please." "Which bank do you want us to send it to?" "None, I'd like to hold it myself." "I'm sorry, that isn't allowed any more". This is not limited to a government regulating use of its own currency, but to any and all public and private money as well. These bureaucrats are lucky they don't have to stand for election.

This isn't their current policy; they're just considering it. Even with the current "travel rule" adopted by 16 countries so far (a VASP must exchange KYC data with other VASPs when transferring, but transfers to and from private wallets are exempt), It would be interesting to see a challenge under privacy laws.

I can't imagine a German court being too happy that a German citizen's private data will be sent from a licensed wallet provider in German to any commercial wallet holder in any other country that the German citizen transacts with. It makes a mockery of GDPR and similar legislation.

 

[JohnLocke]

This is crazy, I was wondering when this will stop and who can stop the EU from controlling the people.

 

[Tax Cow]

Most interesting ideas from FATF, as usual.

I'm not against it tbh. Unregulated underground exchanges with no KYC will get more liquidity. It's about time the crypto industry awarded those who risk their own wellbeing to offer true peer to peer trading experience. Not the fake p2p platforms like LocalBitcoins who disgracefully sniff for documents.

 

[khinkali]

@xzars the funny thing is that USA seems to side with decentralised exchanges as some kind of freedom of speech.

If you operate a centralised exchange that doesn't collect KYC information: go to jail.

If you use and even contribute code to a decentralised exchange with no central authority: welcome to the land of the free.

It seems to be the same for privacy. Run a mixer: go to jail. Release an open source decentralised mixing service: welcome to the land of the free. Totally opposite to the Japanese approach of banning privacy coins.

I think the US and others will go after fiat linked coins though; all transactions over $xx in USD backed coins will need to be declared to Uncle Sam.