PayPal Joins Coinbase TRUST Network to Comply with Travel Rule
Nicholas Otieno Aug 24, 2022 05:25
Coinbase has welcomed PayPal for joining TRUST, a global coalition that offers top-tier privacy and security safeguards to clients across jurisdictions while complying with the Travel Rule.
PayPal announced on Tuesday that it has joined Coinbase's Travel Rule Universal Solution Technology, aka the TRUST Network, in order to comply with the financial industry's Travel Rule.
Early this year, Coinbase launched TRUST, a global industry-driven solution designed to increase compliance with a requirement known as ‘the Travel Rule’ while prioritizing the privacy and security of customers.
The Travel Rule is a US law under the Bank Secrecy Act, which requires financial institutions and firms to share information about customers if they are sending money above a threshold — the starting point for identifying fund transactions and the parties involved is $1,000.
Since its launch in February, TRUST has onboarded more members including several major crypto firms such as Binance.US, BitGo, BlockFi, Nexo, Crypto.com, Robinhood, and Circle, including Coinbase, among others. PayPal's decision to join TRUST puts the Voyager group's membership count at 38.
In a statement, Coinbase said: “The addition of PayPal marks another milestone in TRUST's journey to become the global, industry-standard solution for Travel Rule compliance.”
The move by firms joining the TRUST comes as an increasing number of crypto-related firms want to expand their businesses while becoming compliant with regulations. These companies believe that being compliant opens more business opportunities while maintaining customer confidence, thus helping them to fulfil their goals.
TRUST was reportedly formed in response to crackdowns from the inter-governmental Financial Action Task Force (FATF) on Virtual Asset Service Providers (VASP) to comply with anti-money laundering (AML) and anti-terrorist financing (ATF) policies.
Brands Embracing the Potential of Crypto
The recent crypto market crash has sparked a wave of fear, uncertainty, and doubt in the entire industry. Despite the troubles triggered by the stablecoin crash, crypto adoption has remained at an all-time high, given the number of mainstream companies that are adopting cryptocurrencies for business transactions.
PayPal, a US multinational fintech firm operating an online payments system, gave its users the ability to purchase, sell and hold cryptocurrencies in October of 2020. Then, in March last year, PayPal launched Checkout with Crypto, a feature that allows consumers to check out millions of online businesses using cryptocurrency.
In response to customer demand, PayPal in June of this year started allowing its users to transfer crypto from their accounts to other wallets and exchanges.
Some of the other major firms taking crypto mainstream include the likes of Starbucks, Burger King, Microsoft, and AT&T, among others including online retailers such as Overstock and carpooling companies such as Ryde.
The above examples show that the mainstream adoption of cryptocurrencies is on the rise. Despite the ups and downs of the market, there is still a lot of interest in the use of cryptocurrency. This is likely to continue as more and more firms start to see the benefits of using crypto.
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