FCA mandates data reporting on crypto transfers

investmentweek.co.uk:

Coming into force on 1 September, the UK rule applies even when crypto companies use third-party suppliers.

In a statement yesterday (17 August), the FCA said that crypto operators will now be expected to comply with the ‘Travel Rule', an international attempt to prevent use of digital assets for crimes such as financing terrorism and money laundering.

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The rule brings crypto firms into the regulatory sphere of the Financial Action Task Force, a global anti-money laundering watchdog, and requires them to collect and transmit specific information on the origin of funds and their beneficiaries.

In June 2023, FATF noted its «serious concern» that many jurisdictions had still not brought in the rule, as well as the challenges arising from the various delays to implementation, leading the FCA to work «closely with industry» on how to comply with it.

Coming into force on 1 September, the UK rule applies even when crypto companies use third-party suppliers.

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However, it will not prevent firms from sending and receiving digital assets from jurisdictions that have not implemented the rule, though they must conduct a «risk-based assessment» on whether to release the assets to the intended beneficiary, the FCA added.

«We will keep our expectations under regular review as global adoption of the Travel Rule develops and we will communicate any changes accordingly,» the regulator said.

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