Knowledge base

The Travel Rule is a regulation imposed by the Financial Action Task Force (FATF) that requires Virtual Asset Service Providers (VASPs) to share information about their customers and transactions with other VASPs when sending or receiving virtual assets.

A virtual asset (VA) is defined by the FATF as a digital representation of value that can be digitally traded or transferred and can be used for payment or investment purposes, which includes cryptocurrencies like bitcoin and ether.

A Virtual Asset Service Provider (VASP) is defined as any natural or legal person who conducts one or more of the following activities or operations for or on behalf of another natural or legal person:

• exchange between virtual assets and fiat currencies;
• exchange between one or more forms of virtual assets;
• safekeeping and/or administration of virtual assets or instruments enabling control over virtual assets;
• and participation in and provision of financial services related to an issuer’s offer and/or sale of a virtual asset.

Self-hosted wallets are not subject to Travel rule, however, under certain circumstances they may fall under its scope.

The Travel Rule is important for preventing money laundering, terrorist financing, and other illicit activities that could be facilitated by virtual assets.

While this may vary by country, the FATF recommends that the following main: Personally Identifiable Information (PII) to be sent:

• legal name of sender/recipient
• address of sender/recipient
• account number of sender/recipient