Comment on new FATF Guidance on Virtual Asset by CEO of STOBOX Gene Deyev
Friday, 21 June a major event for an entire crypto industry occurred — new guidance on virtual assets from Financial Action Task Force took effect. It was signed by 37 FAFT Members which include China, USA, Switzerland, Japan, European Commission and others. It will introduce new rules for all players and will have a major impact on the industry.
STOBOX CEO Gene Deyev comments on the most important takeaways from the guidance and their impact on the industry:
“The most important requirement introduced is a requirement to identify their users for all virtual asset service providers (VASP), which includes crypto wallets, crypto exchanges and all other professional players. They introduce direct guidance on what data specifically should be gathered and how the user`s activity has to be monitored. If crypto company fails to build this process during the next 365 days since the guidance took force, their activity will be considered illegal and corresponding actions will apply. Additionally, they providоe a framework to identify, in which jurisdiction a VASP is incorporated, which is important to understand if the new guidelines apply to them.
One of the major impacts is the cleaning of the crypto playing field. There are currently thousands of unregulated exchanges, many of which provide low-quality services and do not take compliance seriously. Those will either improve or stop existing. And I believe, it should happen, it’s a sign of a mature industry when only professional regulated players are left.
Another impact is making the crypto industry even more professional due to the introduction of new players — traditional banks. The regulation, which is currently applied to VASP is the same, that has been applied to banks for a long time. The lack of a clear legal framework was a reason why previously banks hesitated from entering the industry. Now this problem is solved and we are going to see fierce competition between banks, who have enormous legal expertise but don`t have and industry-specific technical expertise, and current players, who have a working technical framework, but mostly don’t have any legal experience.
Also, I expect that we are going to see a rise in BTC prices. For the general public, the lack of trust to crypto assets was the most important reason, why they stayed away from them. But now they have legal protection and trusted traditional institutions are entering the field. Bitcoin serves as a benchmark for a general state of the crypto industry and as industry stars a new stage of development and adoption the digital gold is going to reflect it in prices.
We at STOBOX are supporting these regulations as from the very beginning it was clear that crypto industry seeks some regulation and FATF is just the right tool for that. It’s clear that the future of the crypto industry is in integration with the global financial system, which is impossible without corresponding to global legal requirements”.
Our team of legal advisors from European Union, Switzerland and the USA, together with Baseley Partners, CryptAdvise AG and STOBOX business development experts start offering complete regulatory audit and compliance services to crypto companies around the world.
Contact us to learn more about how this guidance impact your business and what should you do in order to stay compliant.
Download FATF Guidance on Virtual Asset document.
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