The Cayman Islands Government Treasury Department announced that it has initiated a legal framework for virtual asset service providers. or VASP.
The ministry stated this in a press release on October 31 The measure has “strengthened the country’s ability to regulate and attract the people and organizations that deal with virtual assets as a company”.
The first phase of applicationwhich is already in progress focuses on anti-money laundering and terrorist financing compliance and enforcement.
The new framework includes the updated recommendations approved by the Financial Action Task Force in 2019.
As Cointelegraph reported at the time, These recommendations included the controversial “travel rule”, This requires value-added service providers to collect and disclose personal data about the originator and beneficiary of transactions.
Existing value-added service providers and newcomers to the market must register with the Cayman Islands Monetary Authority to show that they meet global anti-money laundering and terrorist financing standards.
The Cayman Islands AML / CFT regime is currently under review by both FATFs and by the Caribbean Financial Action Task Force following a recent peer review report.
The VASP framework will be available for review prior to the CFATF requalification scheduled for November. The results of the FATF review are expected to be released by the end of the first quarter of 2021.
The second phase of implementing the framework will include “regulatory oversight and licensing requirements”. and is expected to come into force in June 2021.
Last month The Cayman Islands have been removed from the black list of tax havens in the European Union and they appear to be making serious efforts to improve their image in financial circles.
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