The Financial Action Task Force (FATF) was established in 1989 by Group of Seven (G-7) and is the global authority regulating Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT).Blockchain, bitcoin, crypto assets, virtual currencies ...&nbsp;a whole new vocabulary describing innovative technology to swiftly transfer value around the world. The fast-evolving blockchain and distributed ledger technologies have the potential to radically change the financial landscape. But, their speed, global reach and above all anonymity also attract those who want to escape authorities’ scrutiny.&nbsp;Blockchain originated just over 10 years ago. Since then, virtual assets have become widely available and have started to be used as payment products. However, without established regulation and oversight, the sector is often still referred to as the “wild west” of the finance industry.<h1>How can criminals misuse virtual assets?</h1>In 2017, the “Wannacry” ransomware attack held thousands of computer systems hostage until the victims paid hackers a ransom in bitcoin. This attack resulted in an estimated USD 8 billion in damages to hospitals, banks and businesses all around the world. Other ransomware attacks have happened since and appear to be on the rise.<img src="https://storage.googleapis.com/kryptogo-website.appspot.com/public/cms/1234_3288393aa2/1234_3288393aa2.png" alt="1234.png" srcset="https://storage.googleapis.com/kryptogo-website.appspot.com/public/cms/thumbnail_1234_3288393aa2/thumbnail_1234_3288393aa2.png 226w,https://storage.googleapis.com/kryptogo-website.appspot.com/public/cms/small_1234_3288393aa2/small_1234_3288393aa2.png 500w,https://storage.googleapis.com/kryptogo-website.appspot.com/public/cms/medium_1234_3288393aa2/medium_1234_3288393aa2.png 750w," sizes="100vw">Source：<a href="https://www.fatf-gafi.org/publications/virtualassets/documents/virtual-assets.html?hf=10&amp;b=0&amp;s=desc(fatf_releasedate)">https://www.fatf-gafi.org/publications/virtualassets/documents/virtual-assets.html?hf=10&amp;b=0&amp;s=desc(fatf_releasedate)</a><h1>FATF Focus on Virtual Assets since 2019</h1>Virtual assets have many potential benefits. They could make payments easier, faster, and cheaper; and provide alternative methods for those without access to regular financial products.Nevertheless, without proper regulation, they would risk becoming a virtual safe haven for the financial transactions of criminals and terrorists. The FATF has been closely monitoring the developments in the crypto space and in recent years has seen the first countries start to regulate the virtual asset sector, while others have prohibited virtual assets altogether. However, as yet, the majority of countries have not taken any action. These gaps in the global regulatory system have created significant loopholes for criminals and terrorists to abuse.With support from the G20, the FATF has issued global, binding standards to prevent the misuse of virtual assets for money laundering and terrorist financing. The term “virtual asset” above refers to any digital representation of value that can be digitally traded, transferred or used for payment. It does not include the digital representation of fiat currencies.<blockquote>“While crypto-assets do not pose a threat to global financial stability at this point, we are closely monitoring developments and remain vigilant to existing and emerging risks.”&nbsp;</blockquote>—G20 learders, in the Osaka Summit in June 9th, 2019Effective implementation of these standards globally in all countries will ensure that virtual asset technologies and businesses can continue to develop and innovate in a responsible manner, and will create a level playing field.<h1>Where does the supervision take place?</h1>Traditional banks that have physical headquarters and client bases near their offices.Virtual asset service providers often have a global presence and customer base.So where do these standards apply and who should be regulating them?Regardless of where the server is located and where it operates, the country/region in which the virtual asset service provider is registered as a company is its primary regulator.<img src="https://storage.googleapis.com/kryptogo-website.appspot.com/public/cms/234_1d2aebd957/234_1d2aebd957.png" alt="234.png" srcset="https://storage.googleapis.com/kryptogo-website.appspot.com/public/cms/thumbnail_234_1d2aebd957/thumbnail_234_1d2aebd957.png 205w,https://storage.googleapis.com/kryptogo-website.appspot.com/public/cms/small_234_1d2aebd957/small_234_1d2aebd957.png 500w," sizes="100vw"><h1>Building a Partnership of regulating</h1>Regulating virtual assets service providers is challenging for everyone. National authorities need to develop skills to understand the technology involved, while the virtual asset service providers have to learn about the financial rules that now apply to their sector.&nbsp;It is up to the sector itself to develop the technology to meet the FATF’s requirements, particularly when it comes to securely collecting and transmitting originator and beneficiary information.&nbsp;To help governments and the industry itself, the FATF has developed a risk-based approach guidance with significant input from the sector itself. The guidance explains how to understand the risks, how to license and register the sector, and what the sectors needs to do to know who their customers are, store this information securely and detect and report suspicious transactions.<ul><li><a href="https://www.fatf-gafi.org/publications/fatfrecommendations/documents/guidance-rba-virtual-assets.html">FATF Guidance for a Risk-Based Virtual Assets and Virtual Asset Service Providers</a></li></ul>The FATF has engaged intensively with the virtual asset service provider sector to build a partnership between governments and the sector and better understand the issues and risks involved, including by hosting annual fintech/regtech forums since 2017.&nbsp;Through its Contact Group, the FATF continues to further explain the FATF’s requirements to the industry and to monitor developments and understand how the industry is meeting the various challenges.<img src="https://storage.googleapis.com/kryptogo-website.appspot.com/public/cms/12345_e76f556e10/12345_e76f556e10.png" alt="12345.png" srcset="https://storage.googleapis.com/kryptogo-website.appspot.com/public/cms/thumbnail_12345_e76f556e10/thumbnail_12345_e76f556e10.png 245w,https://storage.googleapis.com/kryptogo-website.appspot.com/public/cms/small_12345_e76f556e10/small_12345_e76f556e10.png 500w,https://storage.googleapis.com/kryptogo-website.appspot.com/public/cms/medium_12345_e76f556e10/medium_12345_e76f556e10.png 750w," sizes="100vw"><h2>Countries need to:</h2><ul><li>Understand the risk confronting money laundering and terrorist financing in the sector.</li><li>Register and license virtual asset service providers.</li><li>Regulate the sector, just as they do other financial institutions.</li></ul><h2>Virtual asset service providers need to:</h2><ul><li>Implement the same precautions as financial institutions, including customer due diligence, recordkeeping, and suspicious transaction reporting.</li><li>Access and hold the information with securely transmitting originator and beneficiary during the transaction.</li></ul><h1>Looking ahead and taking effectual action</h1>The technology behind virtual assets is developing rapidly. Future developments should not create loopholes that terrorists and criminals can exploit. Countries should implement the FATF measures as soon as possible to ensure the transparency of virtual assets transactions and keep funds associated with crime and terrorism out of the crypto space.Today, many virtual asset service providers are considered “risky businesses” and are denied access to bank accounts and other regular financial services. While the implementation of the FATF requirements is challenging for the sectors, it will ultimately increase trust in blockchain technology as it is the backbone behind a powerful and viable means of value transfer.The FATF has revised its assessment methodology, which sets out how it will determine whether countries have successfully implemented the FATF recommendations and oversee the virtual asset service provider sector.<ul><li><a href="https://www.fatf-gafi.org/publications/mutualevaluations/documents/fatfissuesnewmechanismtostrengthenmoneylaunderingandterroristfinancingcompliance.html">FATF Methodology for assessing compliance with the FATF Recommendations and the effectiveness of AML/CFT systems</a></li></ul>The FATF standard ensures virtual assets being treated fairly and taking the same protections as financial sectors. The regulations of the FATF apply to the conversion of virtual assets into legal tender and the transfer of virtual assets from one type of virtual asset to another.<ul><li><a href="https://www.fatf-gafi.org/publications/methodsandtrends/documents/virtual-assets-red-flag-indicators.html">Virtual Assets Red Flag Indicators of Money Laundering and Terrorist Financing [September 2020]</a></li><li><a href="https://www.fatf-gafi.org/publications/fatfrecommendations/documents/12-month-review-virtual-assets-vasps.html">12 Month Review of Revised FATF Standards – Virtual Assets and VASPs [July 2020]</a></li><li><a href="https://www.fatf-gafi.org/publications/fatfrecommendations/documents/guidance-rba-virtual-assets.html">Guidance for a Risk-Based Approach to Virtual Assets and Virtual Asset Service Providers [June 2019]</a></li><li>T<a href="http://www.fatf-gafi.org/publications/fatfrecommendations/documents/fatf-recommendations.html">he FATF Standards: FATF Recommendations [revised&nbsp;June 2019]</a></li><li><a href="https://www.fatf-gafi.org/media/fatf/documents/recommendations/Virtual-Assets-FATF-Report-G20-So-Called-Stablecoins.pdf">FATF Report to the G20 Finance Ministers and Central Bank Governors on So-called Stablecoins [June 2020]</a></li><li><a href="https://www.fatf-gafi.org/publications/fatfgeneral/documents/statement-virtual-assets-global-stablecoins.html">Money laundering risks from “stablecoins” and other emerging assets</a></li></ul><blockquote>With KryptoGO’s one-stop KYABC (Know Your Address/Business/Customer), your compliance work is done in KryptoGO and automated due diligence can be done with minimal effort.</blockquote>

Blockchain, bitcoin, crypto assets, virtual currencies ... a whole new vocabulary describing innovative technology to swiftly transfer value around the world. The fast-evolving blockchain and distributed ledger technologies have the potential to radically change the financial landscape. But, their speed, global reach and above all anonymity also attract those who want to escape authorities’ scrutiny. 

FATF Methodology with the Rapid Development of Virtual Assets 

The Insiders Among Us: June 18th, 2025

The Press F Experiment: June 4, 2025

It’s a Date! Vibe Coding Workshop: May 22, 2025

Unlocking Web3 Potential: Real-World Applications of KryptoGO Wallet

Meet KryptoGO Pay: April 30, 2025

Yua Mikami Ignites Solana Meme Coin $MIKAMI – The Ultimate Guide 

Create Your Crypto Payment Link: No Code Required, Accept Payments Globally!

One-Click Integration of Crypto Payments into Your App

The Future is Universal: April 9, 2025

The Signals Update: March 26, 2025

The Pump Hound Update: March 12, 2025

Escape Exchange Risks: Why KryptoGO Self-Custody Wallet is the Ultimate Choice for Web3 Users

Handle Login and Group Chats Update: February 26, 2025

Evolution of Taiwan's VASP Regulation: From Declaration to Licensing

Beginner's Guide to Hyperliquid ft. KryptoGO App: Feb 12, 2025

Refining the Waves with Ocean v3: January 22, 2025

Biweekly Update: January 8th, 2025

The '25 Roadmap Preview: December 18, 2024

“The King of Tron” Update: December 4, 2024

Biweekly Update: November 20, 2024

The 'Pulse' Update: November 6, 2024

In-Depth Technical Analysis: Why Choose a Mature Crypto Wallet Service Instead of Building Your Own

Five Stages of Evolution for Crypto Wallets

Biweekly Update: October 23, 2024

Biweekly Update: October 09, 2024

Biweekly Update: September 25, 2024

Send Via Link campaign and "Gimme more wallets" Update :  September 11, 2024

The “Send Crypto via Link” Update: August 28, 2024

KryptoGO's Award-Winning Innovations at ZK Hack Montreal, ETHDenver, and ETHTaipei

Stake Your Stables! Biweekly update: August 14, 2024

The “Not Just A Wallet” Update: July 31, 2024

Biweekly Dev Update: July 17, 2024

Biweekly Dev Update: July 3, 2024

Biweekly Dev Update: June 5, 2024

Challenges and Solutions for Using Cryptocurrency in Business Operations

Biweekly Dev Update: May 22, 2024

Biweekly Dev Update: May 8th, 2024

Biweekly Dev Update: April 17th, 2024

Biweekly Dev Update: April 3rd, 2024

Biweekly Dev Update: March 20th, 2024

Making Sense of Decentralized Wallets: EOA and Smart Contract Explained

Biweekly Dev Update: March 6th, 2024

Centralized vs. Decentralized: The Ultimate Guide to Choosing the Right Crypto Wallet for Your Business

Navigating Compliance in Taiwan's Cryptocurrency Market: From Fraud Prevention to Enhanced Regulation

【Kind Reminder】Please be vigilant against scams. KryptoGO will never proactively ask you to make investment transactions.

Biweekly Dev Update: February 21th, 2024

Biweekly Dev Update: February 7th, 2024

Web3 Business Operations: Future Trend or Current Necessity?

Biweekly Dev Update: January 24th, 2024

Biweekly Dev Update: January 10th, 2024

Biweekly Dev Update: December 27th, 2023

Biweekly Dev Update: December 13th, 2023

Biweekly Dev Update, November 29th, 2023

Biweekly Dev Update, November 15, 2023

Biweekly Dev Update: November 1st, 2023

Biweekly Dev Update: October 19th, 2023

Biweekly Dev Update: Oct 4th, 2023

The Chatroom and Social Update: September 20th, 2023

Play-to-Earn vs. Blockchain Gaming: Rediscovering the Joy of Play

Product Launch Update: September 6th, 2023

KryptoGO Launches AI-Powered One-Stop Web3 Cloud Solution

Biweekly Update: August 23rd, 2023

The Keyless Wallet Update: August 9th, 2023

Biweekly Update: July 26th, 2023

Biweekly Update: July 12th, 2023

Biweekly Dev Update: June 7th, 2023

Unlock the Future: Passkey + DID + FIDO - Exploring the Next Generation of Digital Wallets and Identities

Biweekly Dev Update: May 24th, 2023

Biweekly Dev Update: May 10th, 2023

Biweekly Dev Update: April 26th, 2023

KryptoGO team wins three ETHGlobal Tokyo Hackathon Awards! Join hands with YGG Japan and IVC to lay out GamiFi industry

Biweekly Dev Update: April 12th, 2023

Help enterprises enter the Web3 world painlessly! What is WaaS?

Biweekly Dev Update: March 22th, 2023

How Much Does It Cost to Develop a Cryptocurrency Wallet on Blockchain?

How to Navigate the Metaverse: A Guide to 7 Different Types of Crypto Wallets

Virtual asset transaction service KYC, AML demand increased! KryptoGO Compliance work with Gaia Information  pioneered regulatory investigation engine

Biweekly Dev Update: March 8th, 2023

DeFi and KYC: Conflict or Coexistence?

Biweekly Dev Update: February 22nd, 2023

KryptoGO Wallet Updates: Supports Ronin chain, Personal Profile, Wallet Connect 2.0

Biweekly Dev Update: February 8th, 2023

Biweekly Dev Update: January 18th, 2023

Coinbase, the most compliant exchange, has been fined $100 million by the government and given a deadline to fix it.

Biweekly Dev Update: January 4th, 2023

Biweekly Dev Update: December 21, 2022

Biweekly Dev Update: December 7th, 2022

Biweekly Dev Update: November 23rd, 2022

Why can't you get your crypto assets back when the FTX exchange collapses? – Not Your Key, Not Your Coin

Biweekly Dev Update: November 9th, 2022

Biweekly Dev Update: October 26th, 2022

Biweekly Dev Update: October 12th, 2022

Biweekly Dev Update: September 28th, 2022

Things you should know about financial security in the Web3 era: How does token, private key, and wallet (account) work?

Collaboration for Web3 Game Wallets: YGG Japan, KryptoGO, and IVC Join Forces

Biweekly Dev Update: September 14th, 2022

Wanting to issue NFT but is complained about the difficult procedure? —Find out what the marketing pain points are from the “distribution process”

Biweekly Dev Update: August 31th, 2022

Crypto Wallets: Custodial vs. Non-Custodial Wallets

All You Need to Know About VASP FATF

FATF Methodology with the Rapid Development of Virtual Assets

Recommend Articles

Hot Articles

Hot Tags