Coinbase, along with 17 other crypto firms, recently launched a “Travel Rule Universal Solution Technology” (TRUST), a platform that will enable the group of well-established US companies to achieve anti-money laundering compliance. money and the financing of terrorism. (LAB/CFT) bonds–announcement the largest crypto exchange in the United States.
The Financial Action Task Force (FATF) has announced that it will recommend that member countries apply the long-standing compliance requirement for traditional financial institutions, known as the “travel rule”, to virtual assets (VAs) and Virtual Asset Service Providers (VASPs) returning in 2018, published its crypto guidelines finalized to the public in October last year.
The infamous rule requires VASPs to identify both originators and beneficiaries of transactions above a certain threshold, and as such involves passing this information on to their VASP counterparties.
Many global regulators have adopted the FATF recommendation that VASPs apply the travel rule to any cryptocurrency transaction above USD/EUR 1000 involving another VASP.
“To do this, a leading group of crypto exchanges have come together to create a solution in the crypto space, while continuing to protect the security and privacy of our customers’ personal information. This unprecedented effort has led to a jointly designed solution, TRUST, which we hope will soon become the industry standard to comply with these requirements,”
Wrote Coinbase in a blog post announcing the industry-focused solution.
TRUST drives our industry forward.
We are proud to be one of 18 major US crypto exchanges to participate in TRUST, an industry-led travel rule solution.
Learn more here👇https://t.co/O48lrQIJrY
—Coinbase (@coinbase) February 16, 2022
According to the announcement, the platform is supposed to allow cryptocurrency exchanges to securely send information legally required by the travel rule currently has 18 members: Anchorage, Avanti, BitGo, bitFlyer, Bittrex, BlockFi, Circle, Coinbase, Fidelity Digital Assetsˢᵐ, Gemini, Kraken, Paxos, Robinhood, Standard Custody & Trust, Symbridge, TradeStation, Zero Hash and Zodia Custody.
In the blog post, Coinbase explained that the main design goal of TRUST was to:
“achieve high-level compliance with the Travel Rule, while fully respecting customer expectations for how their information is handled.”
The crypto exchange further listed “important safeguards” that have been incorporated into the design of TRUST.
These do not include any central storage of personal data, as well as proof of address ownership.
“We never centrally store sensitive customer information where it could be targeted by an attacker or misused by a third party,” Coinbase wrote, explaining that the information is sent directly from a TRUST member to another, and that the receiving VASP is required to protect them. .
The solution also includes a mechanism for the receiving TRUST member to prove ownership of the recipient’s cryptographic address before customer information is transmitted, ensuring that the correct information is sent to the correct VASP.
Finally, all TRUST members are required to meet core anti-money laundering, security, and privacy standards before joining.
Partnering with Exiger, a global market leader in technology-enabled compliance and risk management solutions, will help TRUST “hit that bar and provide ongoing compliance support.”
According to the announcement, the next step is to add new members and expand internationally.
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