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Regulators Debate Cryptocurrency Legislation Ahead of G20 Summit

The new rules for crypto businesses will be released in June 21 but many regulators are already worried about the repercussions.

Cryptocurrency regulation will take a step forward during the upcoming V20 Summit where country representatives will assess the new course of legal action proposed by the international Financial Action Task Force (FATF).

FATF will release proposals on June 21 in hopes of setting new international standards for crypto businesses.

Legislators support the summit, which will also bring together national blockchain associations and the world’s leading Virtual Asset Service Providers (VASPs).

Related: Brazilian Financial Authorities Announce Regulatory Sandbox For Blockchain

FATF standards for blockchain and cryptocurrency have set high expectations among legislators. Of special interest is its impact on long-lasting financial security issues, a subject addressed by Japanese Congressman, Naokazu Takemoto.

“The VASP industry recognizes the importance of clear regulation in preventing financial crime and mitigating corruption,” Takemoto said.

The event, which will run parallel to G20 Summit on June 28 and 29 in Osaka, Japan, takes a new dimension by being held at the only country to have a legal framework for cryptocurrencies.

The latest examples given by Japanese regulators include measures to tighten restrictions on speculative trade and new obligations for exchanges, such as keeping a cryptocurrency protection fund.

Regulatory Concerns

Related: Rhode Island Looks to Adopt Blockchain For Government Use

While regulators agree on the need to control cryptocurrency businesses, too much regulation could backfire.

According Roger Wilkins, FTAF ex-president and former secretary Australian Department of the Attorney General, a common concern is that new regulations could push the public out of controlled platforms.

“What we are hearing from industry is that the new rules may have the opposite effect to which they were intended, effectively forcing crypto transactions off the controlled platforms, which are currently one of the best avenues we have in gaining visibility over financial crime,” Wilkins said.

Blockchain association representatives from China, South Korea, United Kingdom, Singapore and Australia will also be present at the event to review the new standard. Prior to that, the blockchain industry will know for sure if it will face real oppression from the international body.

In the mean time, legislators agree in the necessity for a balance in order to adapt and take advantage of the upcoming regulations. Nonetheless, is well-known that there’s no such thing as flexibility or non-compliance when it comes to following FATF recommendations.

“As a former regulator, I recognise how important it is to identify a balanced solution that implements the recommendations of the FATF while also building the opportunity for business,” Wilkins said.

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