Developing Countries: FATF released sixth Targeted Update on Implementation of the FATF Standards on Virtual Assets and Virtual Asset Service Providers

On 26 June 2025, the Financial Action Task Force (FATF) released its sixth Targeted Update on Implementation of the FATF Standards on Virtual Assets and Virtual Asset Service Providers (VASPs), assessing global progress in implementing Recommendation 15 (R.15) across 205 jurisdictions. The report identified that while a significant percentage of jurisdictions had conducted risk assessments (76%) and determined a regulatory approach (82%), only 33% of those assessed met or mostly met R.15.4 requirements concerning the licensing or registration of VASPs. As of April 2025, 73% of relevant jurisdictions reported having passed Travel Rule legislation, with further progress noted on enforcement actions and supervisory inspections. However, implementation challenges persist, including identifying responsible entities for decentralised finance (DeFi) arrangements, applying effective supervision to offshore VASPs, and mitigating risks from unhosted wallets and stablecoins, particularly those used by actors in the Democratic People’s Republic of Korea (DPRK). The FATF reiterated its call for jurisdictions to adopt and operationalise anti-money laundering and counter-terrorist financing (AML/CFT) measures under R.15, while planning targeted reports on stablecoins, DeFi, and offshore VASPs by mid-2026.