FATF publishes updated Guidance on Digital Assets and Virtual Currencies

On Oct. 28, the FATF updated its 2019 Guide to Digital Assets and Virtual Currencies.

The new document is part of the FATF's ongoing monitoring of virtual assets and the VASP sector. Countries are encouraged to assess and mitigate the risks of virtual asset and vendor activities; license or register vendors; and mandate competent authorities to oversee or monitor these activities.

VASPs are proposed to be subject to the same measures established for financial institutions. The Guidance will help countries and VASPs understand their AML obligations and effectively implement their sector's requirements.

The updates included in the 2021 Guidance apply to 6 key areas:

• The definitions of virtual assets and VASP are clarified;
• Сlarified how the FATF standards should apply to stablecoins;
• Provided additional guidance on the risks and tools available to countries to address AML risks in the case of reciprocal transactions;
• Updated guidance on VASP licensing and registration;
• Supplemented guidance for the public and private sectors on implementing the "travel rule";
• Principles of information sharing and cooperation among VASP managers are included.

The FATF will continue to closely monitor the virtual asset sector and VASPs for any material changes.