Decrypting Crypto: Supervision, Intelligence, and Recovery in the Virtual Assets Era. A Reference for Latin America and the Caribbean Financial Intelligence Units and Regulators
Date issued
November 2026
Subject
Regulation;
Blockchain;
Digital Asset;
Transparency and Anticorruption;
Finance;
Money Laundering;
Digital Technology;
Smart Contract
JEL code
G28 - Government Policy and Regulation;
G23 - Non-bank Financial Institutions • Financial Instruments • Institutional Investors;
K42 - Illegal Behavior and the Enforcement of Law;
O33 - Technological Change: Choices and Consequences • Diffusion Processes;
F38 - International Financial Policy: Financial Transactions Tax; Capital Controls;
E42 - Monetary Systems • Standards • Regimes • Government and the Monetary System • Payment Systems;
D73 - Bureaucracy • Administrative Processes in Public Organizations • Corruption
Category
Monographs
The rapid expansion of cryptoassets and blockchain technologies is reshaping global financial systems, presenting both opportunities and significant risks for financial integrity. This publication, aimed at Financial Intelligence Units (FIUs) and regulatory authorities in Latin America and the Caribbean (LAC), provides a comprehensive technical, regulatory, and operational reference on virtual assets. It covers foundational blockchain technology, virtual asset categories, regional adoption trends, illicit finance typologies, beneficial ownership challenges, transaction reporting standards, and cryptoasset recovery frameworks. The document addresses the structural gap between fast-evolving technology and slower-adapting regulatory systems, compounded by institutional asymmetries across LAC jurisdictions. Drawing on FATF standards--particularly Immediate Outcomes 6, 7, and 8--and cross-country experiences, it debunks common myths about cryptocurrency anonymity and recovery complexity, while providing actionable guidance for investigations, seizures, and international cooperation. The publication advocates for risk-based, proportionate regulation grounded in technical understanding, public-private partnerships, and regional coordination, offering a roadmap to strengthen AML/CFT/CPF resilience across the region in the virtual assets era.
NO