The FATF’s travel rule sparks privacy coin delisting
In June the Financial Action Task Force (FATF published its final crypto guidelines, including the controversial ‘travel rule’.
The travel rule requires that cryptocurrency exchanges collect and record customer information related to cryptocurrency transactions. The information includes the transaction originator’s name, account number and location, as well as the recipient’s name and account number.
The purpose of privacy coins is to make it extremely difficult for authorities to collect such information and for this reason OKEx Korea has ceased trading of the assets.
In a blog post published this month, OKEx Korea announced that it would terminate trading and cease support for five privacy crypto assets to comply with the Financial Action Task Force ‘travel rule.’
The coins remain available for trading on the global OKEx platform. This implies that the guidance to follow the FATF’s guidelines originated with the Korean government.
Will other exchanges follow?
While the Korean government may be one of the first governments to take on board the guidance from the FATF, over time it is likely that more will follow. This is especially so for exchanges with fiat on-ramps that will look to stay compliant if the regulatory winds shift against privacy coins.
That said, while the FATF consists of representatives from 36 of the world's most influential jurisdictions, the organization’s findings are recommendations only, and are not legally binding.
If the FATF has its way, then cryptocurrency exchanges across all member jurisdictions will be submitting transaction details within 12 months. But as the guidelines only represent an indication of preferred policy, there is no legal mandate for jurisdictions to comply, and as crypto attorney Jake Chervinsky points out, they often do not.
"The more important the financial center, the less likely it is to hand over control of its regulatory regime to an international organization like FATF," tweeted Chervinsky. "Member countries can adopt all, some, or none of FATF's recommendations. There are basically no repercussions for not adopting (or for violating) FATF recommendations."
OhNoCrypto
via https://www.ohnocrypto.com
News, Khareem Sudlow