Crypto-friendly digital payments giant PayPal has been added to the Travel Rule Universal Solution Technology (TRUST) network, joining a host of big names in crypto which moves in accordance with digital asset travel rules.
The announcement took place two months after the company’s payment, the transformation of digital securities and delivery, between PayPal and other wallets and transactions in June of this year. Previously, users could only buy and sell cryptocurrency through PayPal after the company entered the industry in October 2020.
TRUST was launched in February by a group of 18 American virtual asset service providers (VASPs), including heavy hitters such as Coinbase, Paxos, Circle, Kraken and Robinhood. Now that PayPal has joined the ranks, that number has grown to 38.
“The addition of PayPal marks another milestone in TRUST’s journey to become the global, industry-standard solution for Travel Rule compliance,” Coinbase said in a statement on Tuesday.
Under Rule 31 of the Bank Secrecy Act (BSA), commonly known as the TRAVEL Act, US VASPs are required to release certain information related to the transfer of client funds from one financial institution to another. The threshold for identifying financial transactions and the people behind them starts at USD 1,000.
Similarly, the United States introduced the VASP, TRUST group to simplify reporting and make the exchange of information easier and more transparent between them. TRUST uses a solution that has two main functions. A centralized bulletin board to identify each VASP party at both ends of the transaction and an encrypted peer-to-peer (P2P) channel for secure data exchange.
The commission was formed based on the recommendation of the Financial Action Task Force (FATF) in June 2021 to require VASP worldwide to adhere to Anti-Money Laundering (AML) and Counter-Terrorist Financing (CTF) policies.
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