The Financial Action Task Force (FATF) has published an update to its 2019 Guidance for a Risk-Based Approach to Virtual Assets and Virtual Asset Service Providers (VASPs). This updated guidance is a part of the FATF’s continuous monitoring of the virtual assets and VASP sector.
VASPs must follow the same FATF obligations that financial institutions do. The FATF also requires countries to periodically evaluate and mitigate their virtual asset- and VASP-related risks. The authority further requires countries to license or register VASPs and have national authorities supervise or monitor them. Through its various examples and solutions, the updated FATF guidance will help countries and VASPs abide by their AML/CFT obligations.
The updated guidance has revised the information related to six main areas. Firstly, the guidance clarifies the definitions of virtual assets and VASPs. Secondly, it provides guidance on how the FATF standards apply to stablecoins. Thirdly, the FATF has now provided additional guidance on how countries can address their ML/TF risks for peer-to-peer transactions. Fourthly, the document provides guidance on the licensing and registration of VASPs. Fifthly, the FATF has included additional guidance for the public and private sectors on the implementation of the ‘travel rule’. Lastly, the updated guidance highlights the how VASP supervisors must cooperate through information-sharing.
Source: FATF