Fewer Than 30% of the World’s Jurisdictions Have Regulated Crypto, According to the FATF

Crypto regulation around the globe is required in order for us to benefit from it. While the whole point of crypto is decentralization, there have to be actual laws that will protect everyone involved. And, while some countries have already realized that and started regulating the crypto space, we’re still way off the mark. According to the Financial Action Task Force, less than 30% of the world’s jurisdictions currently regulate crypto.

This was communicated by FTAF’s president T. Raja Cumar to Coindesk over a video call from Singapore. Kumar says that the low level of attention warrants a special call to action.

Action Needed Right Now!

Kumar believes that the world should take action right now to regulate the crypto space. The stats were detailed in a progress report that went live on Thursday. Titled “Status of Implementation of Recommendation 15 by FATF Members and Jurisdictions with Materially Important VASP Activity”, the report says that jurisdictions must move to regulate cryptocurrencies right now to avoid the terrorist-financial risks that crypto poses.

By licensing virtual asset service providers, governments can conduct business reviews of the technology and products they use. Of course, the FATF’s recommendations are not mandatory. The task force can’t impose such rules. However, jurisdictions that don’t comply may face global isolation in the future. Their credibility ratings may drop as well, and the FATF may put them on their watchlist.

Compliance Levels Not Satisfactory

For the past couple of years, the FATF has been recommending jurisdictions to start taking crypto seriously. Many have taken action. The task force has created a table with compliant, largely compliant, partially compliant, or non-compliant jurisdictions in its latest report. The criteria used include enacting legislation or regulation of the crypto space, registration or licensing of crypto businesses, and including supervisory inspections.

At the moment, North Korea is blacklisted by the FATF, while Russia’s membership was suspended a year ago after the country’s invasion of Ukraine. According to president Kumar, the FATF won’t force jurisdictions to comply with their recommendations. However, notifications from the government might do so, and the FATF will certainly communicate their opinions.

Countries such as Portugal, Spain, Italy, India, and Singapore and Malaysia have been rated not applicable in the report. That’s because their assessments around compliance with Recommendation 15 are still ongoing. Argentina has already conducted VASP risk assessments, but hasn’t completed any other criteria.

One thing’s for sure – cryptocurrencies are taking a wild swing, and no one can ignore them anymore. It remains to be seen if the FATF’s reach is as long as it hopes for.