By
Chimamanda U. Martha
April 25th, 2024
The move by Binance to join the GTR Alliance comes after the company agreed to pay $4.3 billion to settle criminal money laundering charges brought by the US Department of Justice.
The biggest cryptocurrency exchange in the world by trade volume Binance has joined the Global Travel Rule (GTR) Alliance. This is a bold move to fight financial crimes like money laundering and funding for terrorism.
The main goal of this strategic union is to improve compliance efforts and make sure that user data and transactions are safe. Binance is taking the initiative to follow the global standards set by the Financial Action Task Force (FATF) by working with other players in the industry, such as CODE, Sygna, and Sumsub.
Binance Joins Global Travel Rule (GTR) Alliance
With the rise of financial crimes like money laundering and funding for terrorism, it is more important than ever for coin exchanges to follow the rules set by regulators.
In response to these challenges, Binance has taken steps to beef up its compliance structure and make it easier for organizations in the same field to work together.
The announcement on March 26 said that Binance’s choice to join the GTR Alliance shows its dedication to following rules and regulations.
Steven Christie, the exchange’s deputy chief compliance officer, stressed how important it is to reassure users that their data and activities are safe. He noted that “this move doesn’t just bring us into alignment with FATF’s global standards – it’s about proactively providing our extensive user base with the assurance that their data and transactions are secure”.
As of this writing, the full list of partnership members is not open to the public. On the other hand, the main GTR website lists Binance and CODE as partners. The three biggest cryptocurrency platforms in Korea have joined together to form CODE.
GTR’s Approach to Financial Transactions
The GTR Alliance focuses on getting useful data about both the sender and receiver of deals above certain thresholds. This is one of the alliance’s primary objectives.
The alliance does not specify what the threshold amount is, but it states that various regions vary in limits. For instance, FATF offers a level of $1,000 in USD/EUR, but each country can set its own level, such as $3,000 in the US. The goal of this method is to make financial transactions more open and accountable.
The move by Binance to join the GTR Alliance comes after the company agreed to pay $4.3 billion to settle criminal money laundering charges brought by the US Department of Justice.
European Union Strengthens AML Stance
As reported by Coinspeaker, the European Union (EU) has reaffirmed its stance on cryptocurrency accounts that are anonymous and coins that prioritize privacy. A proposal to stop financial system abuse for money laundering and terrorist financing was just accepted by the European Parliament. This proposal forbids service providers of cryptocurrencies from providing custody or other services for “anonymous crypto asset accounts”.
The decision was made based on the anticipated risk related to the anonymity of cryptocurrency holdings. The proposal claims that because these assets are anonymous, it is impossible to track transactions, which may be used illegally. As a result, the EU thinks that outlawing these kinds of accounts will improve financial system security by making it easier to spot and stop suspicious transactions.