Japan will introduce strict anti-money laundering rules on cryptocurrency transactions from June 1, the Southeast Asian nation’s cabinet decided on Tuesday, according to a report by local news media Kyodo News.
See related article: Crypto’s aversion to anti-money laundering standards is only hurting itself
- Japan will introduce the “travel rule” laid out by the Financial Action Task Force (FATF), a global money laundering and terrorist financing watchdog. The rule refers to guidelines to deter any terrorist financing or money laundering activities through transfer of digital assets.
- The rule requires crypto exchanges, wallet platforms, and other service providers to obtain customer information in transactions exceeding US$3,000.
- The decision by Japan’s cabinet came after its anti-money laundering steps were deemed insufficient by the FATF, the report stated.
- Japan has been taking steps to attract investments from digital assets companies, while sending warning letters to crypto exchanges that violate the country’s laws and regulations. The new laws will align Japan’s regulation with global standards.
- Fellow East Asian nation South Korea introduced FATF’s travel rule last year, while India in March this year took a significant step towards regulating the cryptocurrency industry by expanding the Prevention of Money Laundering Act to include digital assets.
- See related article: Binance says it complies with regulators following US anti-money laundering probe report