Cryptocurrencies are notorious for existing outside the normal regulatory oversight that governs most financial assets. Indeed, that’s a main selling point for many fans of crypto. But a group of international regulators this week outlined a plan to try and put some shackles on these shackle-less digital currencies.
The Financial Action Task Force (FATF), an intergovernmental body, is proposing a set of new rules governing the digital currencies, including that crypto providers would have to pass customer information to each other when transferring funds. This is known as the “travel rule,” and correspondent banks that process cross-border payments have long been subject to it.
While the new rules would not be legally binding, if the 36 countries that make up the FATF all enforce them, they would have some heft. Meanwhile, crypto industry representatives argued that the new rules would be difficult to enforce and encroach on user privacy. If enacted, these measures could significantly change the world of cryptocurrency.