I was writing earlier on cybersecurity. Let me just talk about the elephant in the room : antimoney laundering and terrorism financing.
The Financial Action Task Force very recently has updated its crypto guidelines, which includes clarifications on who is subject to the recommendations. Those are just recommendations, yet they are very influential. Said like this, it may seems boring but the FATF Virtual asset guidelines was first published in 2019, and marked one of the first regulation push in the international community. In that draft, FAFT introduce a new concept virtual asset service providers (VASPs). They were required to fulfill the same criteria as regular financial institutions - which quite heavy regulation. This is why they implemented better KYC.
In short : the FAFT call the government to take action once again - if necessary - under the umbrella of its concept of virtual asset to better regulate NFT and DEFI. FATF is updating its strategy and be ready for most of the world government to follow, translate or implement in some ways this guide. FAFT focused mainly on two points :
It highlighted that while NFTs do not appear to be virtual assets, they should be controlled as such if they are utilized in a fashion that complies with FATF requirements. For the FATF the proper way, for governments, to tackle this matter is a "functional approach". Here, I believe this legitimates governments potential approaches on NFT - that widely know to be used for money laundering.
For FAFT, here also, DApps are not VASPs since the standards do not apply to software. Even if sections of the protocol are decentralized or automated, anybody with "control or significant influence in the DeFi arrangements" are likely to be considered as virtual asset providers. The regulation would always take place at the owner level. The whole question will be to identify them.
I hope you like this kind of short format - feel free to comment !
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