By 2025, China Plans to Introduce Revised Crypto AML Regulations
Chinese policymakers are preparing for a significant amendment to their Anti-Money Laundering (AML) Regulations concerning crypto transactions, as observed by Prime Minister Li Qiang. The revised draft related to AML laws was included in the State Council’s 2023 work plan, disclosed during an executive meeting. The information provided in the meeting also indicated the intent to finalise this legislation by 2025. It’s noteworthy that China has enforced a complete ban on crypto usage since 2021. The first revised draft of Anti-Money Laundering (AML) rules in China was presented in the same year.
Countries Regularly Update Crypto in AML Framework
China isn’t the first country revising its regulations to incorporate crypto transactions into Anti-Money Laundering (AML) frameworks. Major nations like the United States have previously mandated crypto firms to adhere to AML and Know Your Customer (KYC) requirements. Similarly, Japan amended its Payment Services Act in 2017, making it compulsory for all crypto exchanges to register with the Financial Services Agency (FSA) and comply with AML regulations. Since 2018, South Korea has also implemented AML programs for all crypto exchanges. Australia has made it mandatory for all crypto exchanges to follow AML-related rules.
India has also taken a firm stance by issuing notifications on March 7, 2023, bringing crypto and Virtual Digital Assets (VDA) under the purview of money laundering regulations. The current government has shown a strict attitude, prohibiting 9 Offshore Virtual Digital Asset (VDA) service providers in India for failing to operate illicitly and comply with provisions of the Prevention of Money Laundering (PML) Act.
Different Approaches to AML Regulations
While all these countries have introduced AML regulations for cryptocurrencies, the current trend shows variations in their approaches. Although all are members of the G20 group, which is actively working on a global crypto regulatory framework, each country seems to be heading in a different direction regarding implementing these regulations. India, under whose leadership the development of a crypto regulatory framework is underway, has already included crypto in the AML-CFT framework of the PML Act in March 2023. This raises the question of why countries considering a universal approach to regulating cryptocurrencies cannot collaborate simultaneously or why AML regulations are not included in the upcoming global crypto regulatory framework.
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