Many governments worldwide are busy devising constructive regulations for the crypto industry, but at the same time, they are opting for sometimes very strict rules. A notorious law that may be implemented globally is already in effect in the United Kingdom, and its consequences for crypto are significant. On August 17, the UK’s Financial Conduct Authority (FCA) revealed that, starting from September 1, crypto companies are required to conduct stringent identity checks and other customer data-related checks. In the past, you already had to prove your identity with an ID document. However, from today, that’s no longer sufficient because you now also need to specify, for example, the purpose of a particular transaction.
Companies are also obligated to compel customers to provide certain data if the customer has not already done so. This is due to the anti-money laundering measures that the United Kingdom employs, which also apply to commercial banks, for example. If a crypto exchange receives a cryptocurrency transaction from a customer where the Travel Rule does not yet apply, the company must also take this into account. This includes conducting a risk analysis, although it’s not clear what exactly falls under this category. The rules have not been entirely devised by the UK government but by the Financial Action Task Force (FATF). This institution has established rules that various governments are considering implementing, including those of the European Union.
Source: TALK FINANCE
