In just nine days, new rules by the Financial Action Task Force on Money Laundering (FATF) will force cryptocurrency businesses in roughly 200 countries to verify the identities of anyone sending or receiving more than $1,000 worth of digital assets, effectively nullifying their pseudonymity.
A number of US-based firms have responded by exploring the viability of a “global parallel system” that would allow the world’s cryptocurrency exchanges to share data in a bid to remain compliant, Bloomberg reports.
Hedge funds and investment firms that specialize in digital assets could experience trading delays and increased costs for making transactions.
Industry insiders have also warned of increased compliance costs, and say businesses that shirk their responsibilities could end up shutting down altogether.
Factoring in the additional costs, FATF’s new rules could end up hurting small and medium-sized enterprises that might not have the resources to implement the new legal requirements – similarly to how BitLicense affected companies back in 2015.
According to Bloomberg, services with licenses to transmit money could face increased scrutiny from local government agencies, and risk losing them altogether if they don’t comply with FATF’s rules.