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The inclusion of PayPal promises another landmark in TRUST’s expedition to eventually become an international, industry-level solution for Travel Rule compliance.
American Multinational Financial technology firm PayPal has been appended to the list of companies that are a part of the Travel Rule Universal Solution Technology (TRUST) network. The group, which initially comprised not more than five US corporations to establish an anti-money laundering (AML) framework for cryptocurrency exchanges, has organically evolved into a community of more than thirty firms with its administrative influence on countries like Canada and Singapore too.
PayPal is all set to join a community of giants in the crypto world that have initiated the movement to concede to digital asset travel rules around the globe. The disclosure follows two months after the Fintech firm announced a new feature for its customers that allowed them to exchange and trade digital tokens between PayPal and other wallets and exchanges. Before the recent launch, users could only trade cryptocurrency via the app’s wallet which was inaugurated in October 2020.
TRUST was initially set up by a group of eighteen digital asset service providers in the United States, known as the VASPs. Some of the corporate giants included biggies like Coinbase, Paxos, Circle, Kraken, and Robinhood. Ever since the number of companies has only increased and now is at a staggering number of thirty-eight with PayPal joining the ranks.
The inclusion of PayPal promises another landmark in the TRUST expedition to eventually become an international, industry-level solution for Travel Rule compliance, as stated by popular crypto exchange Coinbase in an announcement on August 23. PayPal has over the years, become a leader in virtual payments by utilizing technology to create monetary services and commerce exceedingly efficient and facile.
According to the Bank Secrecy Act (BSA) rule 31, or colloquially called the ‘Travel rule’, US VASPs are by law mandated to share any particular information regarding consumer fund exchange from one monetary enterprise to another. The VASPs were actually established to smoothen the reporting process and allow facile communication between the authorities, making the entire procedure more transparent. It was constructed as a consequence of a proposal from the Financial Action Task Force (FATF) in June 2021 for VASPs across the world to adhere to particular ideals that allowed maintenance of order and subordination with anti-money laundering and anti-terrorist financing regulations.
The company will effectively work on improving subordination with the Travel Rule needed of the US financial Institutions by the Bank Secrecy Act. This rule instructs financial organizations to communicate data and information about clients when a transaction is made on a specific amount. Coinbase’s TRUST network focuses on revealing important data but at the same time, safeguarding user privacy. It will disallow the utilization of central storage for user data and make sure the members are responsible and steadfast in a risk management solution.