• The Financial Action Task Force (FATF) head T Raja Kumar has called on G7 nations to take a more proactive approach to regulating the “lawless crypto space” and combatting illicit digital financial flows.
• The FATF has updated its Recommendations — the global standards on combatting money laundering, terrorism financing and proliferation financing — to include crypto-assets and related financial activity.
• However, countries have been slow in implementing these recommendations and developing regulations for the industry, leading to an uncertain regulatory environment.

The Need For Global Regulation Of Cryptocurrencies

The Financial Action Task Force (FATF) head T Raja Kumar recently urged G7 nations to take a more proactive approach to regulating the “lawless crypto space” as it continues to allow illicit financial transactions to occur around the world. The FATF is a global inter-governmental body that sets standards for combating money laundering, terrorism financing and proliferation financing.

Updates To FATF’s Recommendations

In order to help countries better combat digital financial flows that are fueling crime and terrorism, the FATF has updated its Recommendations — the global standards on combatting money laundering, terrorism financing and proliferation financing — to include crypto-assets and related financial activity. However, despite these updates, countries have been slow in implementing them and developing regulations for the industry as a whole, leading to an uncertain regulatory environment.

G7 Summit In Hiroshima On May 19

Kumar made his comments in a letter published ahead of the G7’s 2023 Summit in Hiroshima slated for May 19th, where the group will discuss various agenda items for the year including cryptocurrencies. During this summit G7 nations will be discussing ways that they can work together in order t bring order into this “lawless crypto space.“

Call For Concerted Global Action

Kumar said eradicating these illicit digital financial flows requires „concerted global action“ from all countries involved in order ensure that no “safe haven” can exist within our current system of finance for such transactions. He believes that by taking collective action through this summit G7 nations can begin working towards finding solutions regarding how best regulate cryptocurrencies while still allowing their usage without fear of criminal activity taking place within it.

Conclusion

It is clear that there is an urgent need for greater regulation within this burgeoning sector if it is going continue growing without posing any risk or threat of criminal activities occurring within it. Through initiatives such as those being discussed at this upcoming G7 Summit there is hope that we will see better regulation implemented which could help bring about further adoption of cryptocurrencies worldwide while still ensuring safety and security when using them