Business

Steve Kaaru

US Treasury: Cryptos must adhere to tough market regulations

Cryptocurrencies that operate in the United States will have to adhere to the highest standards of combating terrorism financing and money laundering. This is the message that a senior U.S. Treasury official had for the crypto industry, Reuters reported. Speaking to reporters during a visit to Switzerland, the official believes that crypto companies haven’t paid enough attention to implementing procedures that can deter such crimes.

Sigal Mandelker, the U.S. Undersecretary of Terrorism and Financial Intelligence, was speaking after meeting with Swiss government officials and representatives from the Bank for International Settlements and other financial institutions.

According to Mandelker, the crypto industry has paid all its attention to developing the underlying technology and ensuring payments are fast and cost-efficient. However, this has come at the expense of implementing measures that can ensure that terrorists and other criminals don’t get to abuse their platforms.

However, the U.S. will crack down on any crypto project that doesn’t adhere to the highest expected standards, she commented.

Whether it’s Bitcoin, Ethereum, Libra, our message is the same to all of these companies: anti-money laundering and combating the financing of terrorism has to be built into your design from the get-go.

Mandelker spoke before a meeting with officials from Switzerland’s financial markets supervisor FINMA. The meeting revolved around the application of proper anti-money laundering safeguards and how to deal with crypto companies that fail to comply with these safeguards.

Mandelker further stated that she believes that Switzerland must be on the forefront when it comes to enforcing such measures, especially since the country has touted itself as a global hub for innovation.

She explained, “Switzerland, like a number of other countries, has promoted itself as a hub for fintech and for innovation, and so of course any country that promotes itself in that way — in my view, it’s incumbent upon that country to take these particular concerns at the highest level in (to) the utmost regard.”

With cryptos becoming more prominent in the financial industry, it has become pertinent for regulators to ensure they aren’t being used by criminals to bypass the existing regulations. Thailand’s anti-money laundering head stated last month that his office would ensure that cryptos aren’t used to launder money, with the U.K. also recently drafting an economic plan to crack down on money laundering activities in the country.

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