A ‘virtual asset’ is any digital representation of worth that may be exchanged, transferred, or used as money. It excludes digital representations of fiat currency.
Virtual assets have numerous potential advantages. They might make payments easier, quicker, and less expensive, as well as providing alternatives for individuals who do not have access to traditional financial instruments.
Because virtual assets provide greater degrees of privacy, have worldwide reach, enabling cross-border transfers simpler, and can be transferred quickly, they are prone to being exploited by cybercriminals to launder money and support terrorists.
The Financial Action Task Force (FATF) is focusing on virtual assets.
The FATF has been carefully tracking the changes in the cryptosphere, governments have begun to control the virtual asset industry, while others have outright forbidden virtual assets. Meanwhile, the bulk of governments have yet to take any action. Because of these flaws in the global regulatory framework, criminals and terrorists have been able to exploit huge vulnerabilities. If they are not properly regulated, they risk creating a virtual safe harbour for illegal and terrorist financial operations.
