August 21st 2020
We are happy to announce today that we have conducted in collaboration with Swiss firms 21 Analytics and Crypto Finance AG the first Bitcoin transfer with automated compliance to the FATF Travel Rule.
The transfer took place yesterday evening between Crypto Finance AG and Mt Pelerin, two affiliated Swiss financial intermediaries, and was powered by the software recently released by 21 Analytics to enable transactions with automated compliance to the Travel Rule.
See the transaction on Blockstream’s blockexporer >
Issued by the Financial Action Task Force (FATF), an intergovernmental organization, the Travel Rule is a new requirement currently being adopted by most of the FATF member countries (including Switzerland) to combat anti-money laundering and the financing of terrorism.
In essence, the Travel Rule says that when a Virtual Asset Service Providers (VASP, any business offering custody, exchange, management and/or transfer services for digital assets) transfers a virtual asset to another VASP on behalf of a client, the transfer must embed KYC/AML information on the transfer's originator and beneficiary.
That requirement has been a new challenge for the cryptocurrency industry, as blockchain transactions were not originally designed to support such messaging. Until now, the temporary solution has been to manually include the required compliance data with each crypto transfer between financial intermediaries. A hardly scalable process.
Today, the solution developed by 21 Analytics allows to do this automatically, as demonstrated by yesterday's transfer between Mt Pelerin and Crypto Finance AG. For its solution, 21 Analytics leverages the OpenVASP protocol, the Travel Rule Protocol (TRP) and the InterVASP Messaging Standard.
21 Analytics CEO, Lucas Betschart, comments: “The speedy implementation of the FATF Travel Rule by financial intermediaries demonstrates the competence with which the Swiss Crypto Ecosystem is taking the lead.”
Crypto Finance AG CEO, Jan Brzezek, explains: “The global adoption of crypto assets requires an international standard as well as the technology and processes to comply with it. We are pleased that this could be implemented in record time. All players now have the legal certainty they need in order for crypto assets to become an important alternative asset class.”
“This live demonstration shows once again that crypto assets and regulatory compliance are compatible through practical solutions, which is one of the key focus of our tokenisation technology.” says Arnaud Salomon, the CEO of Mt Pelerin. “As one of the first Swiss VASPs to be travel-rule compliant, we are proud to be part of this demonstration.”
Led by veterans of the crypto industry, 21 Analytics provides crypto asset compliance solutions to financial intermediaries. The company, based in Zug, offers artificial intelligence-supported software for a FINMA-compliant implementation of the FATF Travel Rule for the transfer of crypto assets between financial intermediaries.
The Crypto Finance Group provides institutional and professional investors with products and services that lead in the digital asset space today. The group includes the holding company Crypto Finance AG, based in Switzerland in the Crypto Valley, and three operational subsidiaries: Crypto Fund AG, the first regulated asset manager for crypto assets authorised by FINMA; Crypto Broker AG, active in 24/7 crypto trading; and Crypto Storage AG, providing crypto storage infrastructure and tokenisation solutions. This award-winning Swiss fintech, founded in 2017, continues to bridge the traditional financial world and the emerging digital asset markets.