Translation 丨 Interlink Pulse · Yaqi
In the news on February 27, Hong Kong Financial Secretary Chen Maobo said in his annual budget speech on Wednesday that Hong Kong may soon strengthen supervision of the cryptocurrency field to better comply with international anti-money laundering regulations.
Chen Maobo disclosed that "detailed recommendations" will come later this year, saying that the new rules are aimed at virtual asset service providers (VASPs), which include cryptocurrency exchanges and wallet custody providers.
"VASP" is a collective term used by the Anti-Money Laundering Financial Action Task Force (FATF) in its latest Guide to Travel Rules. The rule was issued last year, and one of the most compelling directives is the travel rule: requiring a "virtual asset service provider" or VASP to disclose customer information while facilitating transactions of $ 1,000 or more. The requested information includes sender and recipient names, geographic locations, and account details.
Prior to Hong Kong, several regions have begun to use the rule to regulate VASP. The United States has developed a similar concept of FATF guidelines under the country's main anti-money laundering law, the Bank Secrecy Act (BSA). In 2013, the Financial Crimes Enforcement Network (FinCEN) decided that BSA should apply to the cryptocurrency industry. In this recommendation, FinCEN also confirmed the application of BSA travel rules and published its own VASPs guidelines in May 2019. In 2013, the Financial Crimes Enforcement Network (FinCEN) decided to apply BSA to the cryptocurrency industry. In the proposal, FinCEN also confirmed the application of the BSA travel rules and issued guidelines for VASP in May 2019. In 2015, Ripple was fined $ 450,000 for "intentional violations" of the BSA rules.
Switzerland is one of the latest countries to implement the FATF guidelines. In January, the Swiss Financial Market Supervisory Authority lowered the transaction threshold for unidentified cryptocurrency exchanges from $ 5,000 (5,000 Swiss francs) to $ 1,000 (1,000 Swiss francs). The new Financial Services Act meets the FATF's travel rules threshold and aims to address "increased money laundering risks" in the crypto market.
But this rule is likely to be used on a large scale worldwide. Last weekend (February 22-23), the G20 Finance Ministers' Summit was held in Riyadh, Saudi Arabia. The finance ministers of the G20 and central bankers discussed many hot issues. After the meeting, a group of finance ministers from 20 countries and central bank governors issued a joint communiqué, urging countries to implement cryptocurrencies and other virtual assets.
In the G20 communiqué issued after the meeting, the statement on cryptocurrencies was based on the 2019 Leader's Declaration, urging countries to implement the recently adopted Financial Action Task Force (FATF) on virtual assets and related providers. "standard.
The relevant content of the Hong Kong Financial Secretary's speech is actually to meet the requirements of the FATF and also to meet the consensus of the G20.
Just in February, the U.S. Department of Justice disclosed a cryptocurrency money laundering case. From 2014 to 2017, Larry Harmon had transferred more than 350,000 bitcoins to criminals and drug dealers during the operation. That totals more than $ 300 million.
It is worth noting that when the G20, the world's major economies, implements this regulation, the difficulty of laundering money with cryptocurrencies will greatly increase. Some cryptocurrencies, including Bitcoin, will lose most of their "black market" value, which may affect their currency value.