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The Financial Superintendence of Colombia presented a project that seeks to bring clarity to how links between banks and virtual asset service providers (VASPs) will be handled in the future. The document defines certain key terms and determines a set of prerequisites that banks must verify before accepting virtual asset service providers as clients.
Regulation is becoming a key goal for countries in Latam, where cryptocurrency adoption is growing at significant rates. Now the Financial Superintendence of Colombia has presented a document that seeks to establish norms regarding the requirements cryptocurrency exchanges and custody providers must meet to be served as clients by banks. The project defines key terms such as virtual asset service providers (VASPs) and virtual assets within the scope of the regulation.
Likewise, it states that virtual asset service providers must be connected to the UIAF, the financial intelligence office of Colombia, and have an action plan to deal with money laundering and terrorist financing attempts that could potentially be made using their platform.
The project also indirectly refers to compliance with the travel rule promoted by the Financial Action Task Force (FATF). It states that banks must confirm that these VASPs have:
The technological and operational capacity to monitor virtual asset transactions, as well as to obtain, preserve and transmit the information of the originator and recipient of each transaction.
The proposal states that the VASPs will have to be able to present clear information to their customers about the services they offer and the risks associated with these services, the costs associated with these services and the virtual assets found on their platforms.
VASPs will also have a plan to manage operational and cybersecurity-related risks to deal with possible hacks or platform issues that could affect how their services are delivered to their customers. Banks will also have an obligation to separate their responsibilities from VASPs, telling customers that only they and these platforms are responsible for VASP-related issues.
The proposal also lays down restrictions on investments. It says:
The supervised entities authorized to capture resources through deposit products or funds must ensure that the operations of deposits and withdrawals of resources in financial products of deposits or funds in the name of a VASP are carried out only through non-face-to-face channels.
The proposal is still in the discussion phase, and Finanstilsynet will receive proposals on it until 12 August.
What do you think of the VASP regulation proposal in Colombia? Tell us in the comments section below.
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