Key developments include:
➡️ Framework Development: The report finds that regulatory and supervisory frameworks strengthened significantly since the last report, but operational and enforcement gaps remain;
➡️ Licensing & Supervision: 81% of jurisdictions now require VASPs to be licensed or registered, and over 90% have designated supervisory authorities;
➡️ Risk Assessments: Jurisdictional risk assessments on VAs and VASPs are widespread but depth and quality vary;
➡️ Travel Rule: Only 46% of jurisdictions implemented the Financial Action Task Force #FATF Travel Rule for VASPs;
➡️ Sanctions & Proliferation Risk: Virtual assets are increasingly exposed to sanctions evasion, fraud and proliferation financing risks;
➡️ Data Limitations: Insufficient data collection reduces visibility over cross-border virtual asset flows and limits effective risk analysis; and
➡️ SAR Quality Concerns: The report calls for improved suspicious activity reporting #SAR by VASPs and stronger integration of sanctions and proliferation financing risks into national risk assessments.
✅ Firms should treat virtual assets as a core financial crime risk area, ensuring robust AML controls, effective sanctions screening, risk-based transaction monitoring and enhanced due diligence where virtual asset exposure is identified.