CRYPTO-BACKED peer-to-peer lending platforms could face more stringent anti-money laundering (AML) regulations, as the government mulls transferring compliance oversight to the City watchdog.
The government’s cryptoassets taskforce, which consists of the Treasury, the Financial Conduct Authority (FCA) and the Bank of England, released its final report on how to approach cryptoassets and distributed ledger technologies in financial services this week.
It has proposed bringing fiat-to-cryptoasset exchange firms and custodian wallet providers within the scope of AML and counter terrorist financing regulations.
The government has asked the FCA to consider taking on the role of supervising firms in fulfilling their AML/CTF obligations.
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Its proposals would also mean that cryptoasset firms, including crypto-backed P2P lenders, would need to register with HMRC and report any concerns about suspicious activity.
The aim is to clamp down on the anonymous transfer of funds which could be hiding illegal activity.
A consultation will be released in early 2019 on whether to bring crypto-exchange services, wallets, crytpo-P2P platforms and ATMs under the scope of AML regulations.