The Financial Action Task Force (FATF) an independent inter-governmental body that develops and promotes policies to protect the global financial system against money laundering, terrorist financing, and the financing of weapons of mass destruction proliferation recommends that countries adopt the Travel Rule which essentially requires Virtual Asset Service Providers (VASPs) and other financial institutions to share relevant originator and beneficiary information alongside virtual asset transactions, therefore helping to prevent criminal and terrorist misuse. In this article, whilst taking the position that countries need to support innovative practices around virtual /cryptocurrencies to spur financial innovation and efficiency and improve financial inclusion. I argue that Global Southern-based countries would be and are choked to effectively implementing the travel rule as part of their risk-based approach within the ambit of virtual/cryptocurrency regulation due to a number of inherent deficiencies in those countries such as technical expertise in blockchain use and management among public sector regulators, enforcement agencies and actual laws. In addition, the ever-standing problem of lack of broadband internet and penetration as well as electricity outages continue to frustrate private sector efforts in engaging in such innovative efforts.
By Seodi White
Keywords: Blockchain, Cryptocurrency, Legal and IP