After the Financial Action Task Force (FATF) issued directives that warned Japan, the Japanese parliamentary decided to enforce anti-money laundering measures.
Japan’s association with cryptocurrency goes back to its origin. It is believed that Satoshi Nakamoto, name of a person or a group that developed Bitcoin was developed by a person or a group named Satoshi Nakamoto who is believed to, exist in Japan. Though it is not verified, but most people thought that it was a Japanese person who brought forth this technology to the entire world. And today, this island nation is on the verge of enforcing regulatory measures on it.
Why the enforcement now?
The major reason behind this seems to be the directive issued by the global financial regulatory body, the Financial Action Task Force (FATF). According to them, Japan’s existing legal framework is not sufficient to prevent crypto-based fraud.
So on 23rd May, the Japanese parliament unanimously decided to tighten the grip over cryptocurrency transactions. From June 1, the nation will enforce a stricter anti-money laundering (AML) to prevent any occurrence of scams or forgery using digital assets.
The highlight of the Law
The centerpiece of enactment here is the ‘travel rule’. It mandates any entity processing a crypto transfer greater than $3000, will require to give information about the customer to the recipient exchange or institution. And this isn’t something that was mooted only in the Japanese Parliament. It was actually discussed by global leaders at the G7 summit.
At the meeting, many other initiatives proposed by FATF were welcomed. Besides the ‘travel rule’, there were talks about peer-to-peer transactions, DeFi arrangements, and many other possibilitiesle arising out of the crypto sphere.
Recently, Ukraine also launched a program to stop money laundering. And with Japan’s initiative, we can say that the world is now acknowledging the growing influence of crypto on the economy.