New AML regulations for digital assets are implemented in the UAE to bolster crypto regulations in accordance with the FATF Travel Rule.
The Financial Services Regulatory Authority (FSRA) of the United Arab Emirates has implemented a significant measure to strengthen the country’s financial regulatory framework.
The FSRA amended its Anti-Money Laundering and Sanctions Rules and Guidance on December 21. This update incorporates substantial modifications about digital assets, bringing them by the Travel Rule of the Financial Action Task Force (FATF).
Details of The Revision
This revision represents a substantial advancement in establishing more stringent regulations about the transactions of digital assets. Ali Jamal, the chief executive officer of Cryptos Consultancy, emphasizes that the most significant amendments concern wire transfers.
Digital purchases are now explicitly governed by the FATF’s Travel Rule, representing a substantial shift for entities subject to the AML Rulebook. This comprises designated non-financial businesses and professions in addition to financial institutions.
The purpose of these modifications is to increase consistency and clarity with the comprehensive federal regulatory framework of the UAE. Effectively combating money laundering, financing terrorism, and financing proliferation is the objective. Additionally, compliance with targeted financial sanctions is essential to this reform.
Digital Assets Subject to Regulation
Moreover, the amendments establish digital assets as a legitimate form of payment. This incorporation demonstrates the FSRA’s dedication to recognizing the dynamic characteristics of financial transactions. The document explicitly specifies that these regulations apply to payments involving virtual assets.
Progressive UAE Position on Cryptocurrency Regulation
Notable is the UAE’s progressive stance on cryptocurrency regulation. A report published by PwC in December 2023 emphasizes the nation’s progressive orientation.
In addition to implementing an AML and crypto regulatory framework that complies with the Travel Rule, the UAE is nearing the completion of stablecoin legislation.
