editorial
Sumsub, a global verification platform, has announced the launch of a six-month free trial of its Travel Rule compliance solution. The product aims to help global cryptocurrency organizations adhere to the new Crypto Travel Rule legislation, which has been expanded in the United Kingdom to combat money laundering and terrorism financing.
The Travel Rule, which was introduced in the United States ten years ago, has now been extended to virtual assets (VAs) and virtual asset service providers (VASPs), including cryptocurrencies. Under this rule, both senders and recipients of VA transfers are required to exchange identifying information, verify the accuracy of the data, and share it with government authorities if necessary.
Sumsub’s Travel Rule solution enables secure information transfers between VASPs to meet compliance requirements. The free trial plan offers a single console access to create up to 10,000 outbound transactions and process unlimited inbound transactions, conduct free anti-money laundering (AML) checks, and set up unlimited rules based on regulatory and business requirements. Premium and enterprise plan options with increased transaction limits and additional features will also be available.
The trial period will help organizations ensure compliance and readiness, especially as the United States introduces additional legislation from entities such as the Securities and Exchange Commission and the Office of the Comptroller of the Currency. It will also assist with the approval of Bitcoin exchange-traded funds in U.S. federal court. Sumsub’s ecosystem already includes over 1,000 crypto businesses, including 500 VASPs.
Sumsub highlighted the importance of compliance and identity verification in the crypto industry, citing the cumulative sum of AML fines reaching $5 billion by the end of 2022. The implementation of the Travel Rule has been deemed “relatively poor” by the Financial Action Task Force (FATF), with the majority of jurisdictions found to be only partially or non-compliant.
In the United States, the Travel Rule applies to VA transactions exceeding $3,000. The country is compliant on nine of the FATF’s 40 recommendations and largely compliant on 22, partially compliant on five, and not compliant on four. Japan, Hong Kong, and Portugal have already enforced the Travel Rule for crypto transactions, while Lithuania will implement it in 2025.
Jacob Sever, co-founder and CIO at Sumsub, emphasized the need for a collective effort from regulators, crypto businesses, users, and verification platforms to address the compliance challenges posed by the Travel Rule. He stated that compliance with this legislation is crucial for building trust and transparency in the crypto industry and expressed pride in offering an effective solution to meet the demands of the regulatory landscape. The free trial aims to support UK-based VASPs in becoming compliant from the start of the new legislation, demonstrating Sumsub’s commitment to anticipating regulatory changes and providing innovative solutions for the market.
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