Regulation in the crypto market has been thumbed up by major shareholders in the sector even as the adoption of crypto continues to soar. From a minor peer-to-peer payments system to what would best be described as one of the best forms of investment, crypto has given believers so much.
But while most of the people in the crypto sector carry out legitimate businesses, there are some malicious entities who are always looking for a loophole to carry out their malicious activities.
Ranging from hacks to scams and frauds, these actors have eaten deep into the sector, causing legal traders to run from the sector. But despite these acts, regulators have been able to take drastic steps to ensure that their actions are minimized.
The rule will kick in effect by April 2022
According to the recent news in Japan, the country is gearing towards adopting the recent law that the Financial Action Task Force constructed to tackle malicious acts like money laundering. According to the FSA, it will not in the coming days adopt the travel rule that was made by the FATF.
In this new rule, the crypto exchanges in the country would be mandated to provide the data of transactions records of senders and receivers. In their statement, the FSA said that the new rule would kick in by April 2022.
Also, it has instructed the virtual currency association that they should prepare for the implementation when the time comes. “This rule was established on the premise that we would be able to monitor data of both senders and receivers even if they are from this country or not, hence the travel rule,” FSA added.
The rule will check money laundering and terrorism financing
The association also mentioned that they have looked at everything, and they want to make sure that crypto-related businesses are reliable in the country. The statement also mentioned that they were going to look into everything that they have to consider technology.
This rule was established on the back of several calls for malicious actors using digital assets for various evil reasons. Most of the malicious actors are either using the digital assets for terrorism financing or using it to launder money.
With Japan being a core member of the FATF, the country has accepted the travel rule that was established just like most of the other countries across the Asian region. Also, the previous rule drawn up by the FATF has since been reviewed and updated as they saw fit last month.
With this new rule about to kick into effect, we should be able to witness a drastic drop in the activities of malicious actors even though it is shown that they will always find another way.