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Applying The Anti-Money Laundering Act to Cryptocurrency Trading- Regulation Strengthening Activities of Every Country

ZUU Online SG logo ZUU Online SG 11/9/2018 ZUU
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The Australian Ministry of Justice announced that it is making preparations towards introducing a bill to make the “Anti-Money Laundering (AML) Act” applicable to cryptocurrency as well.

After the bill is introduced, cryptocurrency exchanges will be placed under the jurisdiction of the Australian Transaction Reports and Analysis Center. By improving surveillance, its aim is to curtail the dangers concealed in cryptocurrency transactions to a minimum.

Promoting the FinTech Industry By Maintaining A Cryptocurrency  Diffusion Environment

According to the Australian Ministry of Justice’s announcement, this decision is part of strengthening AML and countermeasures to prevent the transfer of revenue for crime, such as terror funding. The government had made clear its intention to consider the bill at a point in 2016 (via CoinDesk).

In March, the same year while grappling with the resolution of the issue of the double taxation of Bitcoin (which was being viewed as problematic), it was simultaneously decided on 17th May to recognize Bitcoin as a currency and to make it a subject to tax exemption.

After the government had recognized that Bitcoin possesses functions equivalent to that of money, by reorganizing the AML Act, they hope to rally the domestic cryptocurrency industry  - which was strongly considered to have gotten a slightly late start - and by extension, the FinTech industry.

The Complexity of Regulation Strengthening in the USA- a possibility of future consolidation

Revisions in funds settlement laws accompanying the diffusion of cryptocurrency are progressing in the majority of countries and regions.

Even in Japan, cryptocurrency is defined as a currency and new regulations concerning the cryptocurrency exchange industry that obligates cryptocurrency traders to register, and join the Accredited Fund Settlement Business Association, disclose information on cryptocurrency handled, etc. - are being introduced from April (from the Public Relations Office, Government of Japan’s website).

In the USA, where laws differ for every agency and every state, regulations themselves are becoming complex, but it is obvious that the crackdown itself is gradually becoming harsh.

Apart from cryptocurrency traders being obligated to acquire “BitLicenses” in the State of New York since 2015, cryptocurrency traders in Wyoming will be required to hold legal currencies of equivalent value to their Bitcoins as reserve funds.

Opinions that such differing regulations are hindering the diffusion of cryptocurrency in this country can also be heard.

As proposed by the Financial Crime Investigation Network (FinCEN) and others, the day that the registration of exchanges, or the KYC of users (identity authentication, in the case of new accounts), or the introduction of AML become a reality across the USA may not be that far away.

(Kotoko Allen, a freelance writer living in the UK, FinTech online)

This article was posted on August 22th, 2017 on ZUU online Japan.

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