The Japanese government is preparing to enshrine the Financial Action Task Force (FATF)’s crypto anti-money laundering (AML) guidelines into the legal code – after the country’s parliament voted in favor of the measure.
NHK reported that MPs voted for the Revised Act on Prevention of Transfer of Criminal Proceeds in a vote late on Friday at a plenary session of the House of Councilors.
They also voted in favor of amendments to six existing laws, including the Act on Prevention of Transfer of Criminal Proceeds, the Act on Punishment of Organized Crimes, and the Act on Freezing International Terrorist Assets.
Many of these will build in crypto-specific wording to the terms of the acts – as per the FATF’s recommendations to the countries it regulates.
The measures will boost the statutory penalties for crimes related to money laundering. They will allow law enforcers to freeze assets held on domestic platforms – including tokens like bitcoin (BTC).
The media outlet noted that the legal revisions will “make it easier” for law enforcement officials and customs officers to track crypto by obliging business operators who exchange cryptoassets to disclose information about recipients, including their names. This will essentially remove anonymity from crypto exchange transactions.
The legal changes will also apply to stablecoins and their issuers.
The legal amendments also provide details of the kind of warning notices that should be issued to those failing to comply – as well as the kind of criminal penalties that courts should apply in legal cases.
Why Is Japan So Set on Regulating Crypto?
Japanese investors have suffered greatly from crypto exchange hacks – including the Mt. Gox hack of 2014 and Coincheck’s massive 2018 breach.
Ever since, the nation has fast-tracked its crypto regulations push. It has also been pushing international counterparts to follow suit – and adopt FATF and other crytpo regulations.
Last month, the regulatory Financial Services Agency (FSA) issued a call for DeFi players to take part in a “fact-finding survey” on the sector – a suggestion that DeFi regulations might follow in the months ahead.
Compiled by Coinbold