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UK Travel Rule enactment may result in blocking of some crypto transfers

Businesses dealing with crypto assets in the UK may begin to block some crypto transfers to comply with the new Travel Rule, which came into effect on September 1.

Rules affecting virtual asset service providers introduced first time By the Financial Conduct Authority on 17 August and requires UK based VASPs “Collect, verify and share information” It’s about crypto asset transfers.

If a payment is received from a person or entity in a foreign jurisdiction that does not enforce the Travel RuleOne of the VASP “risk-based assessment” to make a decision “Whether crypto assets will be made available to the beneficiary”.

The Travel Rule was designed to bring more transparency to crypto-asset transfers by making it harder for criminals to use crypto-asset transfers. #crypto for illegal activities.

— Financial Conduct Authority (@TheFCA) 17 August 2023

The same rule should apply to Britons wishing to send payments from outside the UK.

The Travel Rule was created by the UN Financial Action Task Force in June 2019.. In July 2022, the UK passed a law. provided for the implementation.

The rule aims to enforce anti-money laundering and anti-terrorism regulations regarding off-chain activities.

Second sygna.ioOther countries that have adopted the Travel Rule include: United States, Germany, Japan, Singapore, Switzerland, Canada, South Africa, Netherlands and Estonia.

On 23 June, FATF criticized member states for: not applying the rule correctlyafter a survey revealed that more than half took no action to implement it.

Research Conducted by FATF in March 2022 29 out of 98 jurisdictions met travel rule requirements and only a few of them had begun to implement them.

in April 2022 Ian Andrews chief marketing officer of blockchain forensics platform channel, announced coordinating the exchange of information between cross-border VASPs. “very difficult problem” to solve – at least initially.

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