How Turkey, UAE, Philippines, and Croatia Got Off FATF’s Grey List - And What It Means for Crypto

When the Financial Action Task Force (FATF) puts a country on its grey list, it’s not just a bureaucratic footnote - it’s a red flag that sends shockwaves through global finance. Banks freeze accounts. Crypto exchanges shut down services. Investors pull out. For countries trying to build digital asset ecosystems, being on that list is a death sentence - unless they fix it.

Between 2024 and 2025, four countries - the United Arab Emirates, the Philippines, Croatia, and Turkey - did exactly that. They didn’t just tweak rules. They rebuilt systems. And in doing so, they unlocked doors that had been slammed shut for years. For crypto businesses, this isn’t just about compliance - it’s about survival, growth, and real access to the global financial system.

What the FATF Grey List Actually Means

The FATF isn’t a police force. It’s a standards body. Founded in 1989, it sets the global rules for stopping money laundering and terrorist financing. Its Jurisdictions Under Increased Monitoring - better known as the grey list - isn’t a punishment. It’s a warning: “You’re not doing enough. Fix this, or face real consequences.”

Being on the list doesn’t mean a country is illegal. But it does mean financial institutions around the world treat it as high-risk. Banks in the U.S., Europe, and Asia either refuse to process transactions or demand extra paperwork, fees, and delays. For crypto companies, this means they can’t open bank accounts. Payment processors shut down. Exchanges can’t list local tokens. Investors get scared off.

The real damage? Legitimate businesses get punished because criminals exploit weak systems. That’s why the FATF doesn’t just slap labels - it gives countries a roadmap. And when those countries follow it? The list gets shorter.

The UAE: From Sandbox to Global Hub

In early 2024, the UAE was removed from the FATF grey list. It wasn’t luck. It was a two-year overhaul.

Before 2022, the UAE had a patchwork of regulations. Free zones operated under different rules. Corporate ownership was opaque. Shell companies were common. The FATF pointed to one key failure: no clear system to identify who actually owned businesses.

So the UAE built one. They launched the Beneficial Ownership Register - a national database where every company, from a Dubai startup to a Abu Dhabi hedge fund, must declare its true owners. No more anonymous LLCs. No more frontmen. If you run a crypto exchange in Dubai now? You must verify your ultimate beneficiaries. And if you don’t? You lose your license.

They also cracked down on enforcement. In 2023, the UAE’s Financial Intelligence Unit (FIU) froze $1.2 billion in suspicious crypto transactions - a 300% jump from the year before. They prosecuted 47 cases involving virtual asset service providers (VASPs). That’s not just compliance - that’s deterrence.

The result? Major banks like HSBC and Standard Chartered reopened accounts for UAE-based crypto firms. Coinbase and Kraken expanded their local operations. And by mid-2025, the UAE had become the top destination for crypto investment in the Middle East - with over $2.1 billion in on-chain activity flowing through licensed VASPs.

The Philippines: From Chaos to Clarity

The Philippines was on the grey list for five years. Why? Weak oversight. No enforcement. A booming crypto market - but zero regulation.

In 2022, the Bangko Sentral ng Pilipinas (BSP) started pushing hard. They required every crypto exchange operating in the country to register as a VASP. That meant KYC, transaction monitoring, and reporting suspicious activity - just like banks.

But the real turning point came in 2024. The BSP launched the Virtual Asset Compliance Unit - a dedicated team that audits exchanges monthly. They didn’t just ask for documents. They checked logs. They traced wallet flows. They matched transaction data with user IDs.

By February 2025, the FATF team came in. They found 98% of registered VASPs were compliant. They saw 1,200+ investigations opened by local authorities. They saw convictions. They saw asset seizures. And they saw real political will - the President personally backed the reforms.

Now, local exchanges like Coins.ph and PDAX can partner with international banks. Filipino users can buy Bitcoin with peso bank transfers again. And the country’s crypto adoption rate? It’s now the highest in Southeast Asia - 44% of adults own or have used crypto, up from 29% in 2022.

Croatia: Small Country, Big Reforms

Croatia’s story is different. It’s not a crypto hub. It’s not even a big economy. But it fixed its system - and it’s a model for smaller nations.

In 2023, the Croatian Financial Intelligence Unit found that 70% of crypto transactions were unreported. Why? Because the law didn’t require VASPs to report. There was no licensing. No penalties. Just silence.

So Croatia passed a new law in late 2024. It made crypto exchanges legally equivalent to banks. They had to:

• Register with the central bank
• Implement real-time transaction monitoring
• Report all transactions over €1,000
• Verify all users with government ID

They didn’t stop there. They trained police to trace crypto flows. They set up a joint task force with Europol. And in June 2025, after an on-site FATF review, Croatia was removed.

It’s not a crypto boom story. It’s a systemic integrity story. Croatia proved you don’t need to be a giant to fix your rules. You just need to be serious.

Turkey: The Missing Piece

Turkey’s name is often mentioned alongside these success stories. But here’s the truth: Turkey is still on the FATF grey list.

It’s not for lack of effort. Turkish crypto usage is massive - over 20 million users, one of the highest per capita rates in the world. But the government’s approach has been inconsistent. In 2023, they banned bank transfers to crypto exchanges. Then they reversed it. Then they introduced a licensing system - but only for large firms. Smaller platforms still operate in the shadows.

There’s no national beneficial ownership registry. No centralized crypto transaction tracking. No public data on enforcement actions. Without those, FATF won’t move Turkey off the list.

So why do people keep saying Turkey was removed? Because they confuse market growth with regulatory compliance. Turkey’s crypto scene is thriving - but it’s thriving in the gray zone. That’s not a success story. It’s a ticking time bomb.

What Removal Actually Means for Crypto

Let’s cut through the noise. Getting off the FATF list doesn’t mean a country becomes a crypto paradise. It means:

• Banks will open accounts again
• Payment processors will accept local businesses
• International exchanges will list local tokens
• Investors will stop running scared

For example, after the UAE and Philippines were removed, the number of crypto-related banking partnerships in those countries jumped by 68% in six months. Local startups went from applying for licenses to raising venture capital.

And it’s not just about money. It’s about trust. When a country proves it can control its financial system, it signals: “We’re not a haven for criminals. We’re a place to do business.”

The EU’s July 2025 decision to remove the UAE and Philippines from its own high-risk list made this even clearer. Now, European firms can legally interact with those countries without extra due diligence. That’s a game-changer for cross-border crypto trading.

The Bigger Picture: Why This Matters for Everyone

FATF’s real goal isn’t to punish countries. It’s to shrink the underground economy. The more people who use regulated banks and exchanges, the harder it is for criminals to hide.

That’s why the FATF now pushes financial inclusion as part of anti-money laundering. Not just to catch bad actors - but to bring in the unbanked. In the Philippines, licensed crypto platforms now serve 8 million people who had no access to traditional banking. That’s not just crypto - that’s economic empowerment.

And for the rest of the world? These four cases show something powerful: regulation doesn’t kill innovation - it protects it.

When you have clear rules, honest businesses thrive. When you have enforcement, trust returns. And when trust returns? Capital follows.

What’s Next?

As of June 2025, only 24 countries remain on the FATF grey list. The next batch likely includes Algeria, Angola, and Bolivia - all with weak crypto oversight.

For crypto founders, the lesson is simple: Don’t wait for permission. Build compliance into your product from day one. The countries that succeeded didn’t wait for FATF to knock. They saw the problem - and fixed it themselves.

If you’re building a crypto business in a country still on the list? Your biggest risk isn’t regulation. It’s being left behind while others move forward.