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Financial Action Task Force (FATF)

The Financial Action Task Force (FATF) is an intergovernmental organisation established in 1989 to combat money laundering and terrorist financing globally. The primary objective of the FATF is to set international standards and promote the effective implementation of legal, regulatory, and operational measures to combat money laundering, terrorist financing, and other threats to the integrity of the international financial system.

The FATF issues recommendations, known as the FATF Recommendations, which provide a comprehensive set of measures for countries to implement to strengthen their anti-money laundering and counter-terrorist financing frameworks. These recommendations cover areas such as customer due diligence, reporting suspicious transactions, and freezing assets related to money laundering and terrorist financing.

The FATF conducts evaluations of its member countries to assess their compliance with these recommendations and works to identify and address emerging threats and vulnerabilities in the global financial system. Its efforts are crucial in fostering international cooperation and coordination to combat financial crimes and maintain the integrity of the global financial system.

Regarding crypto regulation, the FATF proposed Recommendation 16 (the Travel Rule). 

The Travel Rule entails sharing specific customer data whenever crypto assets are transferred between financial intermediaries, such as virtual asset service providers (VASPs), or between VASPs and self-hosted wallets.

Want to know more? Check out What Is the FATF Travel Rule for a detailed explanation of the FATF and its history.

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