From December 30, 2024, cryptocurrency exchanges and other crypto-asset service providers (CASP) in the European Union will have to comply with the “Travel Rule” regulation to meet the new requirements of the local regulatory regime.

EU “Travel Rule” for Crypto Companies Comes Into Force

The European Banking Authority (EBA) announced an extension to Regulation (EU) 2023/1113, known as the “Travel Rule.” Under the new requirements, cryptocurrency services and their intermediaries operating in the European Union will be required to provide information on all fund transfers using digital assets from December 30, 2024.

The initiative was adopted by the EBA as part of the extension of measures to strengthen the fight against money laundering (AML) and terrorist financing (CFT). The new rules apply to all payment service providers (PSP) and crypto-asset service providers (CASPs) that fall within the relevant definitions under the MiCA bill. The rule will also apply to IPSPs and ICASPs, companies that provide intermediary services.

Once the regulation comes into force later this year, CASPs, PSPs, and their intermediaries will have a two-month grace period to bring their activities in line with the new requirements.

The general provisions of the “Travel Rule” for cryptocurrency companies include the need to collect and transmit to the EBA information about:

  • users making transfers of crypto-assets;
  • the relationship of the transaction to the purchase of services or goods;
  • suspicious transfers. 

In addition, crypto services and intermediaries will have to provide the EBA with information that reflects their relationships with each other, as well as other crypto service providers not registered in the EU.

The EU Finance Ministry previously amended the tax transparency regime for cryptocurrency transfer service providers under the Tax Directive (DAC8). Read about what the “Travel Rule” is and how cryptocurrency companies can comply with international data transfer standards when processing cryptocurrency transactions in a special material by CP Media.

Author: Nataly Antonenko
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