Policy will focus on rising cryptocurrency crime

Significance

More cryptocurrency transactions are passing through banks than ever. Banks now face the dilemma of whether they should treat cryptocurrencies as a regular financial instrument and accept the inherent risks, or whether they should wait for more centralised regulation and in the meantime risk illegal transactions flowing through their systems.

Impacts

• Increased regulation will help banks standardise their approach and include these currencies in existing anti-money laundering frameworks.
• Each bank will set its own risk appetite; some will prefer to minimise their exposure until new regulations are finalised.
• Banks will refine their transaction monitoring models to track cryptocurrency payments and flag any that appear unusual or suspicious.