Kingdom

United

Rule

The United Kingdom treasury has released a consultation paper on changes to money laundering regulations that would affect the regulation of crypto assets in a number of ways.&nbsp;
The proposed changes stem from a review of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLRs) undertaken in 2022. The changes <a href="https://assets.publishing.service.gov.uk/media/65e9e1813649a2001aed6492/HM_Treasury_Consultation_on_Improving_the_Effectiveness_of_the_Money_Laundering_Regulations.pdf" target="_blank" rel="noopener noreferrer nofollow">suggested</a> now pursue “smarter regulation”:
<blockquote>
 “This includes minimising regulatory burden and future proofing regulations, making regulation a last resort and not a first choice, and ensuring a well-functioning landscape of regulators that are responsive and accountable.”
</blockquote>
“Of course, the MLRs can only be effective alongside a robust supervisory regime,” the paper added. With that in mind, it outlined several ways in which the supervision of crypto asset service providers might be altered.
Related: <a href="https://cointelegraph.com/news/uk-crypto-travel-rule-comes-into-effect" rel="noopener noreferrer nofollow">UK’s Travel Rule comes into effect, could halt certain crypto transfers</a>
Under regulations passed in 2017, the Financial Conduct Authority (FCA) supervises some institutions under both those regulations and the Financial Services and Markets Act 2000 (FSMA). FSMA-regulated institutions are not required to have MLRs registration, but most crypto firms are not supervised by the FCA and so are subject to MLRs. Under the proposals in the consultative paper, MLRs-regulated institutions would require FCA regulation as well, but no longer be required to seek MLRs authorization.
<figure><img src="https://s3.cointelegraph.com/uploads/2024-03/cebfb37b-26d7-467b-adf9-1fa84a20120f.png">
</figure>
Under the current FSMA regime, crypto assets are under FCA control “if they serve as the underlying asset or property for regulated activities or financial instruments, such as in collective investment schemes.” The reach of the FSMA will be extended to new activities, such as operating a crypto asset exchange and custody. Crypto assets that are not subject to FCA oversight will now have to register with the FCA for MLRs supervision.
Assessments made under MLRs and FSMA differ on a number of points. “In particular, the type of people who can have control and the thresholds for that control are different between the regimes,” the paper said. One of the questions raised in the paper is whether or not to maintain two separate standards of control. The paper suggests aligning MLRs requirements more closely with those of FSMA.
Magazine: <a href="https://cointelegraph.com/magazine/rogue-states-dodge-economic-sanctions-but-is-crypto-in-the-wrong/" rel="noopener noreferrer nofollow">Rogue states dodge economic sanctions, but is crypto in the wrong?</a>

UK treasury seeks to improve AML through crypto supervision changes

Cointelegraph

Other articles published on Mar 12, 2024

Bitcoin Mining Profits Hit New Highs Alongside Rising Crypto Valuation

Solana Price Boost Recovery as Network Adoption Marks New Achievements

Avalanche Price Rally Eyes $90 As Buyers Clear 600-day Resistance

Blockchain Expo North America Returns To Connect Blockchain, Crypto, NFT and Web3 Ecosystems

Gala Games’ GALA Token Doubles in Value as GameFi Sector Surges

Tweety the Looney Tunes Meme: The Innovative Crypto Project That's Making Investors Laugh

Join our free newsletter for daily crypto updates!