FATF has published 2 reports:
- its report on “so-called Stablecoins” looks at the characteristics of stablecoins, their ML/TF risks and how FATF standards currently apply to them and businesses that are involved with them and how monitoring should be enhanced. It notes that there is no formal legal or regulatory definition of a stablecoin and that it is a type of virtual asset which may on occasion be classified as a security. They may be permissioned or permissionless, public or private and retail or wholesale. The broad risks they pose are of anonymity, global reach and layering, as with all virtual assets. FATF standards contain some safeguards, but do not protect against all risks; and
- its report on its standards on virtual assets and their providers, which complements the Stablecoins report. This report is 12 month review of how the revisions to FATF standards as they apply to virtual assets and their providers have worked. Generally FATF is calling on its members to implement the new standards – there has been progress by many members, but more needs to be done. There will be another review after a further 12 months, and updated guidance.