![\"Prepping](\"https:\/\/www.cryptocabaret.com\/wp-content\/uploads\/2020\/10\/prepping-for-next-years-travel-rule-25-us-crypto-service-providers-publish-compliance-solutions-paper-768x432.jpg\")
<\/p>\n<\/p>\n
A great number of cryptocurrency businesses are preparing for the upcoming Financial Action Task Force (FATF) rules toward cryptocurrencies, specifically the Travel Rule. This month 25 Virtual Asset Service Providers (VASPs) published a paper that outlines how American-based VASPs aim to comply with the FATF Travel Rule. <\/strong><\/p>\n Digital currency companies, otherwise known as Virtual Asset Service Providers (VASPs) in the eyes of global regulators are concerned about regulation and compliance this year. In fact, in the recent report<\/a> written by the Digital Currency Group (DCG), the survey\u2019s findings indicate over 150 crypto executives said regulation is the top concern. Currently, a great number of crypto firms are drawing up plans in order to comply with the Travel Rule.<\/p>\n The \u2018Travel Rule\u2019 is a descriptive label for the Bank Secrecy Act (BSA) rule [31 CFR 103.33(g)]. Basically, the rule mandates that all companies that deal with finances have to pass on transmission data like KYC\/AML to the next financial institution. \u201cThe funds\u2019 transfer rules are designed to help law enforcement agencies detect, investigate and prosecute money laundering and other financial crimes by preserving an information trail about persons sending and receiving funds through funds transfer systems,\u201d financial regulators explain<\/a>.<\/p>\n Back in June 2019, FATF had published the \u201cInterpretive Note to Recommendation 15,\u201d which mandates that VASPs have to comply with the regulator\u2019s Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) guidance. The recommendation from FATF concerning digital currency businesses also clarified that VASPs also must comply with the Travel Rule.<\/p>\n More recently, the Financial Action Task Force (FATF) published its FATF Plenary<\/a> on June 30, 2020. The documents show that cryptocurrency businesses would get a 12-month extension in order to become compliant with the Travel Rule. The rule will apply to VASPs when clients transfer funds exceeding $3k, and the VASPs will be required to share KYC\/AML information about the service\u2019s clientele.<\/p>\n FATF\u2019s Travel Rule has sparked the creation of the United States Travel Rule Working Group (USTRWG) which recently published a paper<\/a> called the \u201cTravel Rule Solution\u201d version one.<\/p>\n The USTRWG paper notes that the working group acknowledges that the regulatory landscape is constantly changing and still evolving globally. The group\u2019s paper dated \u201cOctober 2020\u201d gives great detail into how these specific U.S. VASPs plan to comply with the Travel Rule.<\/p>\n \u201cThe ultimate objective of the USTRWG is to solve the industry\u2019s three key components to Travel Rule compliance applied to the virtual currency industry: (1) governance, (2) reliable counterparty identification, and (3) secure data transmission,\u201d the USTRWG paper reveals.<\/p>\n \u201cThe USTRWG solution addresses these functions by proposing: (1) a governance structure to facilitate the formation of a trusted VASP network, (2) a centralized \u201cbulletin board\u201d mechanism to enable identification of transaction counterparties, and (3) an encrypted, point-to-point communication channel to securely transmit required Travel Rule information between VASPs,\u201d the paper\u2019s authors add. Of course, the USTRWG understands that the solution and phased approach will develop differently in a myriad of global jurisdictions.<\/p>\n The USTRWG paper further states:<\/p>\n The solution aims to address the governance, technology, and security needs presented by Travel Rule compliance. The solution initially addresses the U.S. Travel Rule requirements and will evolve over time through a phased approach to enable compliance across different jurisdictions.<\/strong><\/em><\/p>\n<\/blockquote>\n USTRWG\u2019s attempt to comply isn\u2019t set in stone and it is uncertain if regulators would approve such coordination. With the 12-month extension, VASPs are expecting the FATF\u2019s Travel Rule to go into effect by June 2021. USTRWG\u2019s paper says that the working group is very \u201ccommitted to effectively implementing the Travel Rule solution.\u201d<\/p>\n Moreover, the working group details that future USTRWG publications will explain how things are going and evolving within the VASP community.<\/p>\n \u201cUltimately, the vision and objective of the USTRWG and the proposed solution is to build a VASP network to standardize the VASP discovery\/identification process and transmission of Travel Rule data across multiple regulatory regimes in a compliant and secure manner,\u201d the paper\u2019s authors add.<\/p>\n What do you think about the upcoming Travel Rule and the recently formed USTRWG? Let us know what you think about this subject in the comments section below.<\/strong><\/em><\/p>\n The post Prepping for Next Year\u2019s Travel Rule: 25 US Crypto Service Providers Publish Compliance Solutions Paper<\/a> appeared first on Bitcoin News<\/a>.<\/p>\n![\"Prepping](\"https:\/\/www.cryptocabaret.com\/wp-content\/uploads\/2020\/10\/prepping-for-next-years-travel-rule22-25-us-crypto-service-providers-publish-compliance-solutions-paper.jpg\" "\\"Prepping")
\n
![\"Prepping](\"https:\/\/www.cryptocabaret.com\/wp-content\/uploads\/2020\/10\/prepping-for-333next-years-travel-rule22-25-us-crypto-service-providers-publish-compliance-solutions-paper.jpg\" "\\"Prepping")
<\/p>\n