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, Regulators targeting DeFi and NFTs, Forex-News, Forex-News
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Regulators targeting DeFi and NFTs

, Regulators targeting DeFi and NFTs, Forex-News, Forex-News

, Regulators targeting DeFi and NFTs, Forex-News, Forex-News

Indeed, the Financial Action Task Force (FATF), the International Financial Action Task Force (FATF), has published a new Guide for decentralized applications (DApps). Its implications could directly affect the DeFi sector and NFTs.

In this regard, the guide states: «A person conducting business development for a DApp can be a VASP. When it is dedicated as a company to facilitate or carry out the activities described above, on behalf of another natural or legal person».

He also added: «Decentralization of any individual element of operations does not eliminate VASP coverage, if elements of any part of the VASP definition remain».

To better understand, VASPs are virtual asset service providers. And they are responsible for establishing controls against money laundering.

Previous reviews

To recall, the FATF originally published this guidance in June 2019, when the FATF finalized changes to its standards to clearly place anti-money laundering and anti-terrorist financing (AML / CFT) obligations in AVs and VASP.

In July 2020, the FATF committed to update this guidance as set out in its 12-month review report.

, Regulators targeting DeFi and NFTs, Forex-News, Forex-News

Regarding this new guidance, the FATF will consider the report of this review in June 2021.

Accordingly, the FATF is consulting with private sector stakeholders, prior to finalizing the guidance revisions.

DeFi and NFT on target?

In addition to clarifying his wording on decentralized exchanges (DEX) and the mechanisms that power DeFi platforms and applications. The FATF made a reference to non-fungible tokens (NFTs).

As a fun fact, the FATF guidance makes a careful change in terminology, which seems to lean in the direction of the NFTs.

Specifically, as noted by Siân Jones, senior partner at XReg Consulting: «A reference to assets that are fungible, which has important implications in light of the current NFT craze, has been replaced by assets that are convertible and interchangeable.».

«NFTs that can be converted or exchanged for fiat currency or other virtual assets have always been in scope, and still are».

For its part, Blockchain security firm Cipher Trace noted: “Only NFTs that can facilitate money laundering and terrorist financing are virtual assets, in the eyes of the FATF».

«Some non-fungible tokens (NFTs) that do not initially appear to constitute AV may in fact be AV. Because secondary markets allow the transfer or exchange of value or facilitate money laundering and terrorist financing».

But what is the FATF?

Specifically, the Financial Action Task Force (FATF) is an independent intergovernmental body, created in 1989. It develops and promotes policies to protect the global financial system against money laundering and terrorist financing.

In fact, the FATF recommendations are recognized as the global standard for anti-money laundering (AML) and against the financing of terrorism (CFT).

Interestingly, although the FATF can only make recommendations or suggestions, many regulators adopt them internationally.

Therefore, attorney Gabriel Shapiro believes that: «They can have a real effect on the Blockchain industry. Mainly, if the operators are included in the agency’s black list».

Likewise, member countries can apply sanctions, prohibitions and take measures. If the FATF suggests that any entity has “lost control” over compliance and the prevention of money laundering.

I say goodbye with this phrase from Montesquieu: «The law must be like death. Does not exempt anyone».

What do you think of DeFi and NFTs? Let me know in the comment box.

, Regulators targeting DeFi and NFTs, Forex-News, Forex-News

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, Regulators targeting DeFi and NFTs, Forex-News, Forex-News

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