Editor's Note: This article comes fromChain reference (ID: lianneican), Author: Internal Reference Jun, reprinted by Odaily with authorization.
Chain reference (ID: lianneican)
Chain reference (ID: lianneican)
, Author: Internal Reference Jun, reprinted by Odaily with authorization.
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1. Current status of virtual currency anti-money laundering and anti-terrorist financing supervision
Blockchain technology was originally known as Bitcoin, and virtual currency, as the most mature application of blockchain technology, is often used by criminals for information encryption, anonymous transactions, cross-border money laundering and terrorist financing. Therefore, since 2013, my country has successively issued relevant laws to remind the risks of virtual currency transactions. The regulatory attitude is not to support or encourage ordinary people to invest in virtual currencies, hoping to reduce the impact of new virtual currency crimes on the regulatory authorities. Threats and pressure.
Internationally, in order to strengthen the anti-money laundering and anti-terrorist financing supervision of virtual currencies, the Financial Action Task Force (FATF) revised the "FATF Recommendations" in October 2018, which clearly requires that virtual asset service providers Included in the scope of anti-money laundering and anti-terrorist financing supervision, and clearly defined virtual assets and virtual asset service providers. And in the "Risk-Based Guidelines for Virtual Assets and Virtual Asset Service Providers Methodology" released in June 2019, the Financial Action Task Force proposed specific requirements for anti-money laundering and anti-terrorist financing supervision of virtual asset service providers .
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2. The role of centralized exchanges in anti-money laundering and anti-terrorist financing
As a trading place where virtual currency circulation gathers, the countermeasures and efforts of the centralized trading platform in anti-money laundering and anti-terrorist financing are particularly important for the supervision of various countries. At the V20 conference held in Osaka, Japan in 2019, Huobi had a direct dialogue with FATF. The head of the compliance department of Huobi Group said that the platform attaches great importance to the development of virtual asset compliance and will continue to make efforts in this field to strengthen its service as a virtual asset Understanding and cooperation between the platform and regulators to seek effective risk management solutions and promote the healthy development of the industry.
On July 16, 2020, the Twitter accounts of several well-known American figures, including Obama, Biden, Musk, Bezos, and Bill Gates, were hacked. This is a blockchain security incident with great impact in July this year, and it is also a typical digital currency anti-money laundering case. The difficulty of such cases is often that hackers will use various professional tools to launder money.
In this case, most of the fraudulent transfers were less than 0.14 BTC (that is, less than $1,000), and the hacker also used a large number of addresses for obfuscation, which puts great demands on the sensitivity of anti-money laundering tools. However, according to the news obtained by the media, the FBI finally locked the suspect based on the KYC information provided by the US-compliant virtual currency exchange Coinbase.
In fact, the overall path of terrorist financing must not bypass money laundering. The current emergence of blockchain encryption technology allows terrorist financing to find a more suitable channel for money laundering. According to data from CoinHolmes, a digital currency asset tracking platform, in the first half of 2020 alone, there were 13,927 high-risk assets flowing into digital asset exchanges, including many cryptocurrency addresses such as hacker attacks, funds, dark web, gambling, etc. , with total assets of 147,000 BTC.
As an important window for the circulation and realization of virtual currency, the centralized exchange has absolutely leading asset tracking technology and a complete KYC system, which is very important for the promotion of anti-money laundering and anti-terrorist financing.
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3. Regulatory thinking on virtual currency anti-money laundering and anti-terrorist financing
Generally speaking, countries around the world currently lack experience and technology in virtual currency supervision. Although some countries will adopt transitional policies to prohibit virtual currency transactions, in the long run, the transnational nature of virtual currencies determines that it is difficult to achieve substantive results by adopting a policy of prohibiting virtual currency transactions within a country, effectively curbing off-site, Overseas illegal transactions require the joint efforts and coordination of the international community. With reference to the requirements of international anti-money laundering and anti-terrorist financing standards, strengthening the effective supervision and prevention of virtual currency anti-money laundering and anti-terrorist financing can focus on the following four aspects:
(1) Take appropriate regulatory measures to promote the steady development of the virtual currency market
Virtual currency transactions have the characteristics of decentralization, anonymity, and transnationality. If virtual currency transactions and other related activities are completely prohibited through supervision, then entities such as virtual currency traders, exchangers, e-wallet service providers, and financing service providers In fact, cooperation with regulatory authorities is very limited. In addition, the stability of the market is also a very important consideration. Recently, due to the uncertainties of several major centralized exchanges in the world, many lawbreakers take advantage of market panic to commit crimes and frauds. Money laundering and terrorist financing activities are disorderly in the industry. The state also breeds.
By adopting appropriate and effective regulatory measures to guide the stable development of the virtual currency market, it can promote the self-discipline and enthusiasm of virtual currency service providers and investors in anti-money laundering and anti-terrorist financing, thereby promoting their active prevention and assistance in combating related criminal activities .
(2) Introduce a compliance license system to clarify the obligations of relevant entities
Various countries and regions around the world have revised their financial laws to require virtual currency service providers to operate with a license. Anti-money laundering and anti-terrorist financing obligations are stipulated in the license application conditions, requiring them to promptly report to the anti-money laundering authorities and blockchain information services when they find clues to illegal and criminal activities related to virtual currency, especially money laundering and terrorist financing activities. Supervise and manage the reports of law enforcement agencies, so as to form a joint force to prevent and control virtual currency money laundering and terrorist financing activities.
From the current point of view, global virtual currency trading service providers led by Huobi and Binance are very active in applying for compliance licenses. Up to now, Huobi has obtained licenses from Hong Kong, Japan, Thailand, Gibraltar and other countries and regions. At the same time, a person familiar with the matter revealed that in addition to Huobi’s active application for Singapore PSA and US MSB licenses, Binance is currently applying for MSB licenses. It has also been in preparation for a long time.
Issuing compliance licenses through centralized exchanges will help clarify the obligations of relevant entities in anti-money laundering and anti-terrorist financing, thereby effectively relieving the pressure on supervision in virtual currency anti-money laundering and anti-terrorist financing.
(3) Follow the risk-based regulatory approach and strengthen police-enterprise cooperation
The risk-based principle is the basic principle of anti-money laundering established in the first recommendation of the Financial Action Task Force Recommendation. According to this principle, supervisory authorities should identify, assess and understand the money laundering and terrorist financing risks of virtual asset activities and virtual asset service providers’ activities and operations, and adopt a risk-based approach based on risk assessment to ensure prevention or mitigation Measures for money laundering and terrorist financing are commensurate with the identified risks; at the same time, virtual asset service providers are required to identify and assess the risks of money laundering and terrorist financing they face, and take effective measures to reduce such risks.
In recent years, major centralized exchanges around the world have continued to make efforts in anti-money laundering and anti-terrorist financing. Taking Huobi as an example, in July 2018, Huobi officially launched the research and development of the on-chain fund monitoring and tracking system; The police have carried out relevant exchanges and cooperation; and since June this year, Huobi has issued the slogan of "zero tolerance for black production", and has severely cracked down on black production with thunder.
