30 Jun Travel Rule – Preliminary agreement reached in trilogue negotiations for Crypto – Transfers
With the press release of the European Council of 29 June 2022 (https://www.consilium.europa.eu/de/press/press-releases/2022/06/29/anti-money-laundering-provisional-agreement-reached-on-transparency-of-crypto-asset-transfers/), a preliminary agreement has now been reached in the trilogue negotiations for the so-called travel rule for crypto transactions.
The aim of this travel rule is to introduce an obligation for providers of crypto-assets to collect certain information about the originator and the beneficiary of the crypto-transfers they carry out and to make this information available to the authorities. In this way, the traceability and transparency of crypto assets is to be ensured in order to be able to better identify and block possible suspicious transactions of crypto assets in order to combat money laundering and terrorist financing in the European Union.
What is the preliminary outcome of the “Travel Rule” for Crypto Assets?
The new European regulation stipulates in particular that all information about the originator must be transmitted when crypto assets are transferred, regardless of the amount of the transaction. For crypto transfers between crypto assets service providers and unhosted wallets, particularly strict requirements will apply.
Concerning data protection, it was agreed that the General Data Protection Regulation (GDPR) remains applicable to money transfers and that no separate data protection rules need to be introduced.
What does the preliminary outcome of the “Travel Rule” mean for crypto assets service providers?
Crypto asset providers will have to implement appropriate internal policies, procedures and controls to reduce the risk of circumventing the restrictive anti-money laundering and anti-terrorist financing measures of the European Member States of the Union. This means an even higher administrative burden for crypto service providers.
What is the timetable for the implementation of the “Travel Rule” for Crypto Assets?
According to the press release of 29 June 2022, the European Union agrees on the urgency of this new regulation in order to ensure traceability and transparency of crypto asset transactions. Therefore, it was decided to align the timeline for the application of the Travel Rule with that of the Regulation on Markets in Crypto Assets (MiCA).
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