The leading strategic advisory firm, Financial Integrity Network or FIN, has released an advisory recommendation for U.S. Congress concerning the regulatory measures of the cryptocurrency sector.
In a testimony before the crucial hearing, FIN announced that it purports to establish a new financial institution under the Bank Secrecy Act (BSA) which will focus on the governance of Virtual Asset Providers or VASPs. FIN proposes in the testimony to maintain control over the VASPs based on the services they offer to the clients.
The U.S. Senate Committee on Banking, Housing, and Urban Affairs’ subcommittee on National Security and International Trade and Finance, will hold a hearing regarding the concerned issue on Tuesday. In the hearing, David Murray, the reputed Vice President of FIN for Product Development and Services arm, will testify his considerations in front of the dignitaries.
According to Murray:
Some VASPs are currently regulated as money transmitters under the BSA. Others are not regulated at all.
The spearhead further stated that stringent rules and regulations are obvious to make the continuation of some crypto firms difficult, but welcoming all firms is surely not BSA’s work.
The testimony presented by FIN advocates that efficient legislation will wither away rogue crypto companies from the network making jurisdiction easier. It advocates that the Improving Laundering Laws and Increasing Comprehensive Information Tracking of Criminal Activity in Shell Holdings Act is a prominent step towards curbing of anonymous firms.
Based on the testimony, cryptocurrency jurisdiction can be strengthened with the formation of the new financial institution, namely, Virtual Asset Transaction Validators. Criminals and fraudsters take advantage of the lack of overall financial crimes compliance (FCC) monitoring over a handful of cryptocurrencies. This system-wide drawback makes it cumbersome for the United States to identify anonymous companies and abandon them from the U.S. financial mainnet.
Transparency of retail as well as other payment modes should ensure transparency of transactions, suggested the testimony. This transparency is facing the backlash of the crucial changes in the payments industry, which is affecting both retail and consumer payments system.
Japan and Switzerland have been at the forefront to come up with a well-established regulatory network for cryptocurrency-based programs and investments. Facebook, the social media giant, created a regulatory group in Switzerland, which is imbibed with authority to govern its stable coin, Libra.
In April a group of 20 lawmakers presented a request before the Internal Revenue Service which made the authority planning to update its 2014 guidelines on cryptocurrencies. To give a boost to the