The Financial Action Task Force (FATF) published its sixth targeted update on implementation of its standards for virtual assets (VAs) and virtual asset service providers (VASPs), assessing compliance with Recommendation 15 and its Interpretative Note, and setting out where jurisdictions need to accelerate regulatory and supervisory action to mitigate illicit finance risks. The update finds overall progress since 2024 in developing or implementing AML/CFT regulation and taking supervisory and enforcement actions, including among jurisdictions with materially important VASP activity. The report highlights persistent gaps in licensing and registration regimes, difficulties identifying natural or legal persons conducting VASP activities, and challenges mitigating risks from offshore VASPs. It reports that 99 jurisdictions have passed or are in the process of passing legislation implementing the Travel Rule and, alongside the update, the FATF published Best Practices on Travel Rule Supervision to support the design of supervisory frameworks. The update also refreshes a table of steps taken by jurisdictions in the FATF Global Network with materially important VASP activity, which the FATF notes represent about 98% of the global VA market, and flags emerging risk trends including increased stablecoin use in illicit activity, a USD 1.46 billion theft from ByBit attributed to Democratic People’s Republic of Korea actors with only 3.8% recovered, and an estimated USD 51 billion of illicit on-chain activity linked to fraud and scams in 2024.
Financial Action Task Force 2025-06-26
Financial Action Task Force urges jurisdictions to strengthen AML and CFT controls for virtual assets and VASPs and publishes Travel Rule supervision best practices
The Financial Action Task Force (FATF) released its sixth update on virtual assets (VAs) and virtual asset service providers (VASPs), highlighting progress in AML/CFT regulation but noting persistent gaps in licensing and offshore risk mitigation. The report indicates 99 jurisdictions are advancing legislation on the Travel Rule, with Best Practices published to aid supervisory frameworks. Emerging risks include increased stablecoin use in illicit activities and significant thefts linked to North Korean actors.