Cryptocurrency regulations turn global

It’s not even a month when Coinrail, a small cryptocurrency exchange in South Korea was hacked, leading to the loss of more than $40 million in user funds. Another news broke in on May 14, 2018 by Japan’s oldest and most influential newspaper, Mainichi Shimbun. It stated that organized crime syndicates in Japan known as the Yakuza, which co-exist with the Japanese government and police legally due to its deep roots in Japan’s history dating back to 1600.

Yakuza has been using the three anonymous cryptocurrencies namely Zcash, Dash and Monero to launder money produced by its illegal drug operations. It has been found that the Yakuza laundered close to 29.85 billion yen since 2016 worth around $273 million, by conducting transactions on Japan’s major cryptocurrency exchanges.

Because of these happenings, Japanese Financial Services Agency (FSA) had to seek support from G20 countries, to implement unified policies regarding cryptocurrency exchanges and investors. The International Financial Authority Financial Action Task Force (FATF) which oversees 37 countries including USA and France had joined hands with Japan, to put unified cryptocurrency regulations in order, in the upcoming months.

In response, a spokesperson of the FSA stated,
“It’s nearly impossible for Japan to handle the problem alone. Even if trade is restricted to only domestic transfers or monitoring is enhanced, it’s still not enough to counter money laundering. It would be best if all the group of 20 industrial and emerging nations and regions (G20) would take the same steps toward prevention.”

According to experts, unified regulations could result in a major decline in the increasing cases like hacking attacks, money laundering, security breaches, and Know Your Customer (KYC) issues in the long run.

This week, Financial Action Task Force (FATF) said that it is going to begin discussions to implement unified cryptocurrency regulations in the upcoming month and if they arrive at a decision, it is possible that all 37 countries governed by FATF will impose identical regulations.