Some of the biggest players in crypto – including BlockFi, Coinbase and Robinhood – have joined forces to develop technology that helps them meet a rule designed to counter money laundering.
Recommended by the Financial Action Task Force and prescribed in the US by FinCEN, the Travel Rule requires financial institutions to share certain basic information about their customers when sending funds over a certain amount to another FI.
The crypto exchanges have developed Travel Rule Universal Solution Technology (Trust), which they say ensures top-tier compliance while also protecting the security and compliance of their customers’ information.
Trust does not centrally store personal data, with the required information sent from one member to another through end-to-end encrypted channels. The system also includes a mechanism for the receiving exchange to prove that it’s the owner of the receiving crypto address before customer information is sent.
In addition, all Trust member must meet core anti-money laundering, security, and privacy requirements.
The 18 members are Anchorage, Avanti, BitGo, bitFlyer, Bittrex, BlockFi, Circle, Coinbase, Fidelity Digital Assets, Gemini, Kraken, Paxos, Robinhood, Standard Custody & Trust, Symbridge, TradeStation, Zero Hash, and Zodia Custody. Other firms are being invited to join.
Source: Finextra
