Thursday, January 27, 2022

Cyprus joins a growing list of countries looking to regulate the cryptocurrency industry.

The Takeaway:

The island country in the eastern Mediterranean Sea, Cyprus, has joined a growing list of countries looking to regulate the cryptocurrency industry in the near future.

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Cyprus has joined a growing list of countries looking to regulate the cryptocurrency industry in the near future. In a report, the country’s Ministry of Finance noted that the sector poses some risks of money laundering and other illicit activities but claimed local police had acquired enough ‘sophisticated understanding’ to combat them.  

 

Despite little crypto activity, Cyprus’s government is looking to regulate the cryptocurrency industry.

The report follows a risk assessment study conducted by the ministry, the Advisory Authority for Combating Money Laundering and Terrorist Financing, and the House of Representatives. Commissioned in July 2020, the study was completed and finalized in November this year. The study concluded that there’s little cryptocurrency activity in the country. Despite rising adoption in the region, the ministry stated that there had been limited access points for digital currencies into the broader Cyprus economy. The study also found that most local authorities, including the Cyprus Securities and Exchange Commission, have “limited direct understanding or experience regarding the specific Money Laundering and Terrorist Financing risks of VA and VASP sector.

 

The Central Bank of Cyprus and CySEC should update their AML and CFT directives to include crypto.

The report recommends that the Central Bank of Cyprus and CySEC update their AML and CFT directives to include measures that deal directly with cryptocurrencies. These directives must incorporate the Travel Rule to comply with Financial Action Task Force (FATF) recommendations. The Travel Rule requires VASPs to exchange sender and recipients’ identifying information for transactions greater than $1,000. The ministry believes that CySEC has the biggest role to play in regulating the sector. 

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Disclaimer: The article reflects the opinions of the author and is not representative of Chaintimes’ views.
The article does not offer any investment advice. User discretion is advised when investing in or trading with cryptocurrency. Extensive and diligent research should be carried out by the reader before making a decision.

Jai Pratap
Jai Pratap
A Mass Media Graduate who loves to write. Jai is also a sports enthusiast and a big movie buff. He loves to learn new things.

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