Q: Do the Travel Rule updates apply only to EEA countries, or are they required globally?
A: The Travel Rule updates are required globally and are not limited to European Economic Area (EEA) countries. The primary factor is the location of the Cryptoasset Service Provider (CASP) facilitating the transaction. Since BVNK, as a CASP, is based in the EEA, it must comply with the Travel Rule requirements for transactions regardless of the customer’s location. This ensures that the CASP adheres to international standards for anti-money laundering (AML) and financial security.
The Travel Rule itself is a recommendation by the Financial Action Task Force (FATF), a global organization that sets guidelines to prevent financial crimes like money laundering and terrorism financing. This rule essentially mandates that certain identifying information about the sender and recipient of digital asset transfers be shared between CASPs to enhance transparency and security in cross-border transactions. Originally applied to fiat (traditional) currency, this guideline is now being adopted for cryptocurrency transactions.
Jurisdictions worldwide are beginning to implement these standards, and we anticipate global coverage as more countries align with FATF’s recommendations. For an up-to-date list of countries already enforcing the Travel Rule, you can visit: https://notabene.id/jurisdictions. To understand more about the Travel Rule’s importance and impact, refer to our detailed blog post here: https://www.bvnk.com/blog/the-travel-rule-crypto-eu.