UK Central Bank to Clamp Down on Crypto Money Laundering

Posted March 03, 2018

Carney, who is additionally chair of the G20's financial stability board, joins a series of global policy makers to either flag serious concerns about crypto trading or in the case of China, ban it outright.

In other comments, Carney said that he believes cryptocurrency is "failing" as a type of money. It is likely that the great success but finite nature of Bitcoin has spurred others to try to snag a portion of the market in various different ways, just to get on the virtual currency (VC) bandwagon before the oft-prophesized bubble burst occurs.

"At present, crypto-assets raise a host of issues around consumer and investor protection, market integrity, money laundering, terrorism financing, tax evasion, and the circumvention of capital controls and worldwide sanctions", he said. Carney, who also heads the Financial Stability Board - an global financial regulator - joins a growing number of industry insiders calling for greater oversight of cryptocurrencies.

On a positive note Mark Carney said that authorities of European Union and the USA are doing a remarkable job in regulating crypto exchanges.

Authorities in both the USA and European Union have instituted plans to apply anti-money laundering standards and anti-terrorism financing standards to cryptocurrencies in the same way that they do to other financial services products and it now looks like their counterparts in the United Kingdom are to follow suit.

Instead, he specifically mentioned the need "to hold the crypto-asset ecosystem to the same standards as the rest of the financial system".

"This is in part because they are small relative to the financial system".

Still, the answer isn't to isolate or outlaw digital currencies, he said.

"In my view, holding crypto-asset exchanges to the same rigorous standards as those that trade securities would address a major underlap in the regulatory approach", Carney said.

"In his closing remarks, Carney said that the, ". core technology is already having an impact".

Carney also outlined some of the potential advantages of cryptocurrency, the underlying technologies of which he described as "exciting".

Finance ministers and central bankers from the Group of 20 major world economies will meet in Buenos Aires in two weeks' time, and cryptocurrencies are likely to be on the agenda.

Digital currencies can allow anonymous transactions and carry risks including money laundering, terrorism financing and tax evasion.

However, he added that if more people were to start investing, problems may arise.