Today, Cointelegraph reports the Swiss Financial Market Supervisory Authority (FINMA) has a new report that includes warnings about blockchain and money laundering potential.
“In its first-ever yearly risk monitor report published by FINMA on Dec. 10, the regulator warns that blockchain and crypto assets exacerbate the country’s already existing money laundering risks,” writes Adrian Zmudzinski.
In terms of specific risk factors, FINMA has cited potential for anonymity as well as greater agility for transactions and the global reach of decentralized platforms
Ironically, the regulator also notes that bad actors in fintech could slow down the legitimate development of digitization and blockchain systems.
Hidden within the section of the report dealing with blockchain ramifications, FINMA also included a thought on market access:
“Changes and restrictions to the market access regimes in important target markets for the Swiss financial institutions could have significant repercussions for the revenue streams of the Swiss financial centre.”
The Swiss regulator is not the first to cast aspertions on the idea of decentralized digital finance methodlogy. One prime example is blowback from regulators in some of the larger world economies – the Cointelegraph piece cites moves by the European Union Commission, but U.S. regulators have also warned that they’re not likely to greenlight various kinds of digital coin projects until similar concerns are allayed. The demise of Facebook’s Libra illustrates this kind of wariness that will continue to sway officials.
“Since Facebook announced its plans for Libra in June, politicians and regulators around the world have voiced concern about the project, saying it risked upsetting global financial stability, undermining users’ privacy and enabling money laundering,” Tom Wilson at Reuters reported October 15.
Look for changes in government to address the potential of digital currency markets, not just from a purely economic perspective, but with a healthy helping of skepticism on how crypto assets can co-exist with national fiat currencies – and that digital coins will not pave the way to a fraud superhighway.