The Financial Action Task Force (FATF), a 37-nation group set up by the G7 industrial powers, is planning to formulate its first set of governing rules and guidelines that govern cryptocurrency industry by June 2019, the global watchdog said on Friday.

The Paris-based FATF looks for crypto exchanges, among other things, to be licensed, verify customers’ identities, prevent money laundering and for suspicious trading to be reported. It has also boldly unveiled plans to set guidelines for the legalization of initial coin offerings (ICOs).

The move would be an upgrade from guidelines currently in place, which were first adopted by the FATF in June 2015. It was originally spurred by a call in June from the G20 leaders for global regulators to monitor Cryptocurrencies .

The current standards, however, are non-binding. Still, they push back the prospect of setting global rules on the matter, something that some regulators say is needed to tackle a phenomenon that transcends borders. In addition, it leaves the responsibility on local regulators to act, which gives the opportunity for crypto industry players to game the rules by moving their operations to friendlier jurisdictions.

Though few details have emerged about potential actions, certain basic measures are clear or highly expected. This begins with setting up KYC requirements, anti-money laundering and fraud prevention rules, and possibly sanctions screening controls.

FATF’s chief Marshall Billingslea also notes that countries whose compliance programs fail to meet expectations will face the risk of costly actions. Specifically, these countries could be added to “an FATF blacklist that restricts access to the global financial system.”

“By June, we will issue additional instructions on the standards and how we expect them to be enforced,” he added.

Rules Vary, but All Regulators Are Cracking Down

As it stands, the current shifting regulatory landscape for cryptocurrencies across the globe is still very confusing as local regulators are struggling to keep pace with the innovations in the space.

Although it is hard to generalize the attitude towards cryptocurrency, some major hubs – such as Japan and South Korea – were the first countries to legitimize registration system for cryptocurrency exchanges.

Regulation of cryptocurrencies in some regions, however, is still in its early stages, including in the U.S. where lawmakers have not passed any laws addressing it directly.

Meanwhile, the European watchdog warned last year that investors might be unaware of the high risks that they are taking when investing in what has been a red-hot investing scene of late. However, ESMA is largely limiting itself to taking enforcement actions against ICO operators at present, though the agency’s head said it might step up its Regulation of the space more broadly in the nearest future.

With new regulations, a more defined structure, and well-defined demands from clients, the cryptocurrency and ICO industry will be a primary area of focus at the 2018 London Summit.

London Summit, ICOs, regulation

The Financial Action Task Force (FATF), a 37-nation group set up by the G7 industrial powers, is planning to formulate its first set of governing rules and guidelines that govern cryptocurrency industry by June 2019, the global watchdog said on Friday.

The Paris-based FATF looks for crypto exchanges, among other things, to be licensed, verify customers’ identities, prevent money laundering and for suspicious trading to be reported. It has also boldly unveiled plans to set guidelines for the legalization of initial coin offerings (ICOs).

The move would be an upgrade from guidelines currently in place, which were first adopted by the FATF in June 2015. It was originally spurred by a call in June from the G20 leaders for global regulators to monitor Cryptocurrencies .

The current standards, however, are non-binding. Still, they push back the prospect of setting global rules on the matter, something that some regulators say is needed to tackle a phenomenon that transcends borders. In addition, it leaves the responsibility on local regulators to act, which gives the opportunity for crypto industry players to game the rules by moving their operations to friendlier jurisdictions.

Though few details have emerged about potential actions, certain basic measures are clear or highly expected. This begins with setting up KYC requirements, anti-money laundering and fraud prevention rules, and possibly sanctions screening controls.

FATF’s chief Marshall Billingslea also notes that countries whose compliance programs fail to meet expectations will face the risk of costly actions. Specifically, these countries could be added to “an FATF blacklist that restricts access to the global financial system.”

“By June, we will issue additional instructions on the standards and how we expect them to be enforced,” he added.

Rules Vary, but All Regulators Are Cracking Down

As it stands, the current shifting regulatory landscape for cryptocurrencies across the globe is still very confusing as local regulators are struggling to keep pace with the innovations in the space.

Although it is hard to generalize the attitude towards cryptocurrency, some major hubs – such as Japan and South Korea – were the first countries to legitimize registration system for cryptocurrency exchanges.

Regulation of cryptocurrencies in some regions, however, is still in its early stages, including in the U.S. where lawmakers have not passed any laws addressing it directly.

Meanwhile, the European watchdog warned last year that investors might be unaware of the high risks that they are taking when investing in what has been a red-hot investing scene of late. However, ESMA is largely limiting itself to taking enforcement actions against ICO operators at present, though the agency’s head said it might step up its Regulation of the space more broadly in the nearest future.

With new regulations, a more defined structure, and well-defined demands from clients, the cryptocurrency and ICO industry will be a primary area of focus at the 2018 London Summit.

London Summit, ICOs, regulation