The past week saw cryptocurrencies firmly in the thick of it, as financial watchdogs across the globe committed to preventing Russians from evading sanctions through buying digital currencies; cryptoasset exchanges in South Korea are set to cooperate with compliance measures ahead of impending anti-money laundering rules from FATF; and Thailand announced a ban on cryptocurrency payments with the aim to fight financial crime and instability.
Find out more on these stories below.
Financial crime watchdogs worldwide show solidarity with Ukraine by monitoring Russian cryptocurrency trading
Financial regulatory bodies across the globe have committed to closer scrutinisation and information sharing on potentially illegal cryptoasset trading by Russians, especially any believed to be playing a role in Russian president Vladimir Putin’s ongoing invasion of Ukraine.
The Financial Stability Board (FSB), an eponymous thinktank, regulatory body, and monitoring agency of which all the G20 nations are members, has endorsed and recommended the move after consultations prompted by financial regulators- including Britain’s Financial Conduct Authority and Bank of England- concerned that Russian backers of Putin are using cryptocurrency to dodge economic sanctions.
On the other side of the conflict, Ukraine announced earlier in March 2022 that cryptocurrency had been legalised to facilitate donations into the country’s coffers, with its digital technology ministry stating that “the signing of this Law by the President is another important step towards bringing the crypto sector out of the shadows and launching a legal market for virtual assets in Ukraine.” The UK minister of financial services, Mr. John Glen, added that Britain’s government thinks “these steps will actively support the government’s response to Russia’s invasion of Ukraine.”
Cryptocurrency donations to Ukraine’s army personnel and civilians already total about $100m (£75.92m), meaning that in this situation, crypto could simultaneously be viewed as both a useful tool for, and a threat to the war-stricken country and its population.
Read more on this story at City AM.
South Korean cryptocurrency exchanges embrace impending FATF rule to combat money laundering
South Korean cryptocurrency exchanges have committed to co-operating with the latest Financial Action Task Force (FATF) travel rule, which came into effect on the 25th of March 2022. The rule provides guidance and regulatory protocols for virtual asset service providers (VASPs) and is intended to counter money laundering and terrorist financing via digital currencies.
VerifyVASP, a crypto service provider, pre-empted the FATF rule by signing a memorandum of understanding (MOU) with CODE, a collaborative venture designed to meet the obligations of the FATF travel rule, on cryptocurrency transaction information sharing. The MOU links their services, ahead of the new FATF rule which will mean that VASPs need crypto exchange and trading firms to collect and share information on cryptocurrency transactions of ₩1m (£622.69k) or more.
About 30 South Korean VASPs have now partnered with CODE, while other VASPs, including the country’s largest crypto exchange, Dunamu, use VerifyVASP technology.
South Korea is among the first countries in the world to embrace the new FATF rules, and neighbouring Japan’s Virtual Currency Exchange Association (JVCEA) is set to follow suit on 1st April 2022.
Read more on this story at The Coin Republic.
Thailand bans cryptocurrency payments in an effort to fight financial crime and instability
Thailand has announced a ban on payments using cryptocurrencies and other digital assets, which will go into effect next month and will apply to all cryptocurrencies including bitcoin. By introducing the ban, Thai regulators hope to clamp down on the risk of cybertheft and money laundering.
The move means that consumers will be prohibited from purchasing goods or services using digital currencies, although trading of digital assets for investment purposes will be allowed to continue.
Earlier discussions between the Securities and Exchange Commission (SEC) and the Bank of Thailand (BOT) highlighted the need to regulate such activity by digital asset business operators, as they believe it could impact the country's financial stability and overall economy. The risks cited included losses from ‘price volatility, cybertheft and money laundering’.
Digital assets payment operators will be given until the end of April to terminate services. It was reported in Nikkei Asia that 31% of people in Thailand own digital assets.
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