In line with the crackdown recommended by an international money laundering watchdog, Financial Action Task Force (FATF), regulators in Hong Kong are set to tighten their crypto exchanges policies by introducing more strict rules on AML and terrorist financing. The changes which come amid a wider drive from the G20 to improve standards around cryptocurrency exchange regulation worldwide were proposed as part of the 2020 budget in Hong Kong, and will now be subject to a period of public consultation before becoming law. FATF while building on the 2019 Leaders’ Declaration urge countries to implement its recently adopted standards on virtual assets and related providers.
This recommendation comes at a time of increasing moves by regulators worldwide to tighten up their controls over cryptocurrency and exchange operators. Regulators in South Korea and Japan are reported to be taking similar steps to comply more closely with the Financial Action Task Force’s most recent guidance. Other crypto businesses which could also fall within the remit of the revised regulations including crypto remittances services are also thought to be target of the Hong Kong measures. Alongside crypto exchanges, the Hong Kong measures are also thought to target other crypto businesses, including crypto remittance services,