- The FATF travel rule could be implemented within the UK next year
- The government has said that the time is right to look into implementing the FATF travel rule for UK-serving exchanges
- Cryptocurrency transfers of over £1,000 would require specific details to be taken by exchanges
British cryptocurrency users could find themselves having to follow the Financial Action Task Force (FATF) travel rule from 2022 as Britain’s financial overlords look to further tame the wild west of crypto in the country. A report published last week stated that Her Majesty’s Treasury was opening a consultation on the matter that would run for some three months, with the potential for a 2022 introduction into legislation. The travel rule, which has been in place in traditional finance for decades, has led to uproar in the crypto world as it requires the collection of certain information for transactions over a fixed amount, undermining the privacy that was the bedrock of the cryptocurrency movement.
£1,000 Threshold For Information Gathering
In the document announcing the consultation, the government referenced the June 2019 proposal by FATF to fold cryptocurrencies into its travel rule, which demands that cryptocurrency-handling companies hold certain details for transfers above £1,000 in value, including the recipients’ name, address, and account details. Exchanges have already begun to implement such practices with Binance recently integrating CipherTrace Traveler in order to automate the practice of information gathering.
“Time is Now Right” For FATF Travel Rule Implementation
The document acknowledges that “the time is now right to begin planning for the implementation of the travel rule” given such technological advances. The onus will be on crypto-handling firms to implement systems themselves at their own cost or risk falling foul of the Financial Conduct Authority’s code of conduct, resulting in them potentially losing their license to operate in the UK.