Coinbase, Robinhood & Others Launch TRUST To Deal With Travel Rules

As described by themselves, TRUST aims to be an industry-wide solution that has been created in order to comply with the mandates of the Travel Rule.

Through this, the member cryptocurrency exchanges can easily and securely provide requisite data necessitated by the FinCEN.

Time to TRUST?

According to the regulations set by the Travel Rules, every financial institution that is facilitating transactions among its customers is required to share certain data with the FinCEN (Financial Crimes Enforcement Network).

Thus, now even cryptocurrency exchanges have been mandated to follow the rule since it acts as a medium of such transactions.

Furthermore, the rules explicitly state a list of details such as the name, account number, address, identity, etc. which are compulsory for the intermediary financial institution to pass on to the authorities.

Thus, a myriad of cryptocurrency exchanges joined hands in order to find a much more secure way to share these details which led to the birth of TRUST.

The present members of TRUST include Anchorage, Avanti, Bitgo, bitFlyer, Bittrex, BlockFi, Circle, Coinbase, Fidelity Digital Asset Services, Gemini, Kraken, Paxos, Robinhood, Standard Custody & Trust, Symbridge, TradeStation, Zero Hash, and Zodia.

The TRUST platform uses ingenious methods to ensure the personal details are not put at risk in any way. Since TRUST only acts as a secure medium, sending required information through an end-to-end encrypted channel.

Secondly, TRUST has stated to have established a mechanism in play that would make it compulsory for the receiving crypto exchange to have proof of their ownership of the incoming crypto information.

The announcement stated,

“The launch of TRUST resoundingly demonstrates that top-tier compliance can go hand-in-hand with a core industry value–robust protection of customer privacy and security.”

The TRUST also added that they aim at reaching international exchanges as well when it begins with its expansion plan since it does not plan on limiting just to US-licensed exchanges.

The SEC’s Hand

Recently one of the members of TRUST, BlockFi, faced SEC’s wrath as it received a $100 million fine, the biggest in SEC’s history. The penalty came due to non-compliance with regulatory laws in the country.

Thus considering, the income tax on crypto, legislation for insuring “Qualified Stablecoins” and now TRUST, it seems like authorities and people are both looking at creating a strong adoption case for crypto as soon as possible.