The Travel Rule is based on a series of recommendations made by the Financial Action Task Force (FATF), a global organization that sets standards and policies that participating countries can implement in the fight against global financial crime (including money laundering and terrorist financing).
Put simply, the Travel Rule requires financial institutions to share information about parties involved in a financial transaction. The rule applies even when youâre sending/receiving crypto between accounts you own, or on- and off-ramping with Ramp Network.
How does the Travel Rule work for crypto transfers?
Hereâs a simplified breakdown of how the Travel Rule applies to crypto transactions:
Hosted Wallets to Hosted Wallets: If Alice wants to send Bitcoin from her Binance wallet to Bobâs Coinbase address, both Binance and Coinbase must ensure that the details of Alice (sender) and Bob (receiver) match.
Hosted Wallets to Self-Hosted Wallets: If Alice sends Bitcoin from Binance to Bobâs Trust Wallet address, she must declare Bob as the recipient while indicating that his address corresponds to a self-hosted wallet.
For Ramp Network transactions, we need to confirm whether your wallet is hosted or self-hosted and ensure that the wallet belongs to you.
Why is the Travel Rule Important?
While the Travel Rule might seem like an extra step, it serves several important purposes:
Enhancing Security: By verifying the identity of wallet holders, the Travel Rule helps prevent fraud and ensures that transactions are secure.
Preventing Financial Crime: The rule makes it more difficult for individuals or organizations to use cryptocurrencies for illegal activities, such as money laundering or terrorist financing, by requiring transparency in transactions.
Building Trust: By aligning with global standards, the Travel Rule fosters greater trust in the cryptocurrency ecosystem, making it safer for everyone.
What information do I need to provide when buying or selling crypto?
Because you (our customer) are the person weâre sending crypto to, or receiving crypto from, we already know who you are. This means we already hold the information we need to confirm with your wallet host whether or not you own the crypto wallet you are using.
However, we do need you to confirm if your crypto wallet is hosted or self-hosted and confirm that it belongs to you. This is the case both when your crypto wallet is on the receiving side (when youâre buying crypto from Ramp Network) and when itâs on the sending side (when youâre selling crypto to Ramp Network).
If Iâm using a hosted wallet, what information does Ramp Network share with my wallet provider?
Ramp Network shares only the necessary information with your hosted wallet provider to confirm that you own the wallet. This may include:
Your name
Address
Wallet address
User ID
We share this information in line with our Data Privacy Notice and ensure that it is protected according to our privacy and security standards.
How does the Travel Rule apply to me?
The Travel Rule requires all users, regardless of their location, to declare their wallet type when transacting with Ramp Network. However, there is a key difference:
đșđž Users in the US: We donât share your wallet information with providers.
đ Users Elsewhere: If youâre outside the US and using a hosted wallet, weâll share the necessary information with the wallet provider to confirm that you own the wallet.
Even though the Travel Rule is a UK regulation, we're required to collect this information globally to maintain consistency and ensure that all transactions comply with international standards.
Does Ramp Network give my information to the authorities?
We understand that privacy is a top concern. Rest assured, we only share your information with authorities or regulators when legally required. Your data is securely handled, and we limit the information shared to the minimum necessary to comply with the Travel Rule. You can find more details in our Privacy Notice.
What happens if I donât provide the information?
If you donât provide the required information, or if you provide incorrect details, your transaction may be blocked or canceled. Additionally, your account may be suspended or terminated. If you accidentally provide the wrong information, contact our support team immediately for assistance.