The Financial Action Task Force (FATF), a financial watchdog that monitors the global financial system, has agreed to expand its operations to the cryptocurrency sector.
FATF will now seek to introduce global standards for cryptocurrencies and digital assets.
It is hoped this will help the regulator to fight money-laundering and other financial crimes in the crypto sector.
FATF has also agreed to start monitoring the efforts of individual countries to track and limit crypto transactions that could be linked to crime.
According to FATF, many countries have failed to collect and share sufficient information about crypto transactions, which exposes the global financial system to vulnerabilities from the sector.
During a gathering on Friday, FATF decided that this will now change with the help of a new plan coming in the first half of 2024.
One of the shortcomings highlighted by the regulator was the so-called “travel rule” which had to do with the tracking of crypto transactions, especially those that exceed $1,000.
The regulator noted that the rule was implemented in 2019 but by 2023, only 11 out of 98 surveyed jurisdictions were implementing it.
Moving forward, FATF will expect governments to take crypto regulation just as seriously as they do mainstream finance.
In November, the regulator said that it would consider crypto regulation as a grey list factor.
Meanwhile, the International Monetary Fund has also cautioned countries against passing laws that recognize Bitcoin and other cryptocurrencies as legal tender.
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