A Global Cryptocurrency Exchange Legislation
In the latest developments, the Russian Financial Monitor service is now pushing to create a common book for the cryptocurrency. The service is particularly concerned about the flow and supply of cryptocurrency, hence their proposition to create a monetary cap to regulate transactions happening globally. They are planning to set the limit $9000 per transaction.
But what has prompted the FMS to come up with such a proposal? According to Pavel Livadny, the deputy Director FMS, very high transactions are facilitating illegal money laundering, drug trafficking, as well as financing terrorism.
Will it get International Backing?
For the proposal to see light, FMS has to convince a group of 36 countries. They are all members of the Financial Action Task Force (FATF). All these FATF members have the power to curb all the Crimes that risk Cryptocurrency. The task force was set up in 1989 due to the looming risk of international financial crimes resulting from communism crumbling and advancement in technology.
To help curb such financial crimes permanently, the member states are in the process of creating a domestic regulatory framework for the cryptocurrency. According to the service, the borderless nature of all bitcoins is the main facilitator for borderless solutions. They also advise on the introduction if harsher rules. Where the cryptos can convert into an asset class, and the way money laundering will fully curb.
Regulating transactions of more than $9000
The most stringent proposal set by the service was that of restricting all cryptocurrency transactions of more than $9000 or roughly 600000 roubles to a given cap. Though they didn’t have the exact proposal of how far it can get.
Despite Russia bringing such proposals, their own country does not have any legal framework to regulate its cryptocurrency trading. Their tax regulation laws are yet to be pushed to their parliament. However, the state is still concerned about keeping tight controls on the crypto industry.
Difficulty in Implementation
Although the regulations seem good for the future of crypto, its enforcing is still posing a challenge. The Bitcoin has really tried to track all its operations and create some transparency where the users’ identities can be traced theoretically.
However, some networks such as Monero and Zcash come as private networks. This makes it challenging to monitor any of its operations. In addition, the framework has not defined how it would work for the decentralized exchanges.