Trust is the foundation of any value exchange. The more trust between two parties to each other, the more confident they will participate in transactions. Participate not only in high transaction volumes, but also in higher value transactions.

Bitcoin (BTC) and other cryptocurrencies certainly achieve a lot when it comes to creating a decentralized environment in which the ability to rely on the other end of the equation is excluded from the blockchain. Die-hard enthusiasts who already understand this are most eager to get into their vaults and invest in the crypto revolution. However, the truth is that the average consumer has not yet reached this stage.

Some liberals may not want to hear this, but for the cryptocurrency world to reach critical mass it needs much wider acceptance, and the average consumer needs a new level of protection. They need a set of rules and someone to complain to when something goes wrong.

On the subject: Why We Need Evolutionary, Not Revolutionary Organizational Initiatives

There are levels in this
Blockchain technology definitely enables participants to exchange value in an unreliable environment. If you don’t share your private keys, no one can steal your value. Teaching this to newlyweds’ cryptocurrency holders is the key to getting them to make a purchase.

While many see the next step as an obstacle to adoption, regulation in the crypto space will definitely increase the speed. The more layers we add to the consumer protection network, the more confident investors and new users will be.

Rules allow freedom to win
The Bank Secrecy Act came into force in the 1970s and is still the first significant piece of legislation in the United States to combat money laundering and terrorist financing. Basically, this forces banks to work with the US government to fight economic crime. Following the terrorist attacks on the World Trade Center in September 2001, the Patriot Act was born, which further opened up the channels of communication between banks and governments in the same direction.

Fast-forward to 2019: An international governing body called the Financial Action Task Force on Money Laundering has expanded its travel base to include not only banks, but also virtual assets and stock exchanges. The rule states that virtual asset service providers must share the identity of users who trade assets worth $ 1,000 or more.

On the subject: FATF AML: Can the Cryptocurrency Industry Adapt to Travel Rules?

Tracking and presenting this information seems very simple, and it should be. But it also means that virtual real estate providers must complete many other tasks to become interoperable, including:

Determine what a typical cryptocurrency transaction looks like so they can spot abnormal patterns that indicate potential criminal activity.
Checks client portfolios regularly.
Share your blacklisted lead list with virtual asset providers and other authorities.
Share KYC information with virtual asset providers and authorities.
Of course, the problems inherent in the FATF tourist base are quite real. First, it requires purchases from multiple virtual asset providers who operate blockchain projects and exchanges using a variety of technologies. This makes it difficult to track customer information at a thin level. However, the benefits of a tourist base outweigh the challenges. It goes beyond the typical KYC procedures that most crypto service providers follow. KYC mainly refers to the internal activities of an organization. The tourist base is broader in nature. This is pushing for transparency for both virtual asset providers and governments. It aims to get around the idea that some countries should use their own rules for cryptocurrency.

Source: CoinTelegraph

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