The rise of cryptocurrencies has brought an evolution in financial regulations to mitigate the risks associated with the sector. One such measure is the FATF's Travel Rule.

Initially, the Travel Rule only applied to financial institutions; however, in 2019, the FATF expanded its recommendations to include VASPs Virtual Asset Service Providers.

Key requirements

For VA transfers under the 1,000 USD/EUR threshold, FATF recommends to collect the following information:

• The name of the originator (sender) and the beneficiary (recipient).
• The VA wallet address for each or a unique transaction reference number.

For transfers exceeding the above threshold, VASPs should collect:

• The originator’s name.
• The originator’s account number for the account used to process the transaction (e.g., wallet address).
• The originator’s physical (geographical) address, national identity number, and customer identification number (i.e., not a transaction number) that uniquely identifies the originator to the ordering institution or date and place of birth.
• The beneficiary’s name.
• The beneficiary’s account number for the account used to process the transaction (e.g., wallet address).

Sumsub’s Travel Rule solution

Sumsub’s Travel Rule check is part of our Transaction Monitoring solution. It includes a multi-level risk evaluation system that helps businesses determine the risk of the counterparty and, hence decide on transacting with it.

The main benefits of using the solution are:

• Seamless integration with your system and other Sumsub products. You can use the Travel Rule check along with other user verification and transaction monitoring features and AML checks to get detailed information about each transaction.
• Most popular data exchange protocols under the hood including TRP, GTR, Sumsub custom protocol, and email notifications, to streamline the Travel Rule data exchange. The system will automatically select the quickest and easiest way to obtain the counterparty data.
• VASP attribution allowing to determine whether the VA Transaction is carried out with a VASP or an Unhosted Wallet and establish the Counterparty VASP's identity.
• Screening of VA transaction participants against watchlists, global sanctions lists (OFAC, UN, HMT, EU, DFT, etc.), and adverse media.
• Secure ecosystem. Access to the most recent verification data and other documentation related to other Travel Rule ecosystem members to ensure quick confirmation of all transactions.
• Straightforward solution for the interoperability and the Sunrise issues.
• Vast functionality that allows you to configure the exact fields when exchanging data to meet specific regulations.
• 8000+ supported virtual assets.
• Crypto wallet scoring mechanism that lets our clients set up automated transaction rejection based on the wallet's status.

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