The Monetary Motion Activity Power has known as on governments worldwide to step up enforcement of anti-money laundering requirements within the crypto trade, warning that unchecked gaps in regulation may undermine world monetary safety.
In a report launched Thursday from Paris, the worldwide watchdog stated jurisdictions have made progress since 2024 on implementing anti-money laundering and counter-terrorism financing frameworks for digital property and associated service suppliers.
Nevertheless, it famous that crucial challenges stay, notably round licensing, offshore oversight, and figuring out entities concerned in digital asset providers.
The FATF’s newest focused replace targeted on Suggestion 15, which was expanded in 2019 to cowl crypto markets.
With digital property inherently borderless, regulatory failures in a single jurisdiction can have world penalties.
Learn extra within the Focused Replace on Implementation of the FATF Requirements on Digital Property and VASPs:https://t.co/Gt5pyNU6DY#FATF #IllicitFinance #TravelRule pic.twitter.com/hgLyq6HNem
— FATF (@FATFNews) June 26, 2025
Watchdog Flags Rising Stablecoin Abuse by Illicit Networks, Urges Regulatory Motion
In response to the report, 99 jurisdictions have both enacted or are getting ready laws aligned with the “Journey Rule,” a key mechanism to make sure transparency in cross-border crypto transfers. The FATF additionally launched a brand new information outlining finest practices for supervising compliance with the rule.
The report flags mounting threats related to the rise of stablecoins. It stated their use by illicit actors, together with North Korea-linked hackers, terror financiers and drug traffickers, has grown considerably. It warned that mass stablecoin adoption with out coordinated regulation may improve world publicity to illicit finance.
North Korea’s Report Crypto Theft Exposes Weak Hyperlinks in International Enforcement
The replace follows a sequence of alarming tendencies. Up to now this 12 months, North Korea executed what the FATF described as the biggest digital asset theft in historical past, stealing $1.46b from trade platform ByBit.
Solely about 3.8% of the stolen funds has been recovered. This reveals critical gaps in worldwide asset tracing and restoration efforts.
In the meantime, fraud and scams proceed to hassle the crypto sector. The FATF cited trade estimates that round $51b in on-chain transactions final 12 months have been linked to such illicit exercise. These instances level to more and more refined techniques by dangerous actors. Because of this, governments are below rising stress to boost cooperation and enhance asset seizure mechanisms.
In a single instance, the UK’s Operation Destabilise demonstrated how coordinated regulation enforcement can disrupt crypto-fueled prison networks. The FATF stated such efforts should be replicated globally and backed by extra sturdy supervision and enforcement.
The watchdog acknowledged help from analytics corporations together with Chainalysis, Lukka, Merkle Science and TRM Labs in compiling the replace. It additionally burdened that almost 98% of the worldwide digital asset market is concentrated in jurisdictions inside the FATF’s International Community. Bringing these gamers into full compliance, it stated, will likely be key to decreasing worldwide threat.
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