Following on from the most recent FATF Recommendations on digital currency regulation (see article here), the Deputy Governor of the Financial System Stability Working Group, Dr. Okwu Nnanna stated that steps should be taken to regulate digital currencies. According to reports by CoinDesk, Dr. Okwu Nnanna stated that:
” [the] Financial Action Task Force (FAFT) has observed that virtual currency payment products and services (VCPPS) present opportunity for money laundering and other crime risk that must be identified and mitigated. Virtual currencies present a wide range of issues and challenges that require financial authorities to consider and the challenges posed are unique and call for urgent regulator responses.”
Dr. Okwu Nnanna was speaking at the Anti Money Laundering/Combating Financial Terrorism Stakeholders Consultative Workshop when he put forward the idea. In particular, he noted that:
“Virtual currency was dangerous because it was not a legal tender of any country hence it has a borderless nature without jurisdiction which makes it a channel for money laundering.”
This statement seems to be a warm up to next week’s Commonwealth Virtual Currencies Working Group Meeting (24-26 August) on the development of an industry standard for digital currencies. The event will be held in London where representatives from the various 53 countries that make up the Commonwealth will discuss a potential inter-regulatory framework.