Leading cryptocurrency exchange, Binance announced Thursday, February 27 that it has partnered with Shyft Network, a public blockchain protocol for assigning context, trust, and validation into data, to comply with the Financial Action Task Force (FATF) Travel Rule.
Virtual Asset Service Providers (VASPs), which include cryptocurrency exchanges are required under the new FATF Travel Rule, to share specific data like Know-Your-Customer (KYC) and Personal Identifiable Information (PII) between qualifying institutions when conducting transactions for senders and receivers.
Following the partnership, Shyft Network will be helping the Binance to comply with the said FATF Travel Rule, by implementing Shyft’s decentralized infrastructure. Per the report, the network offers the first end-to-end decentralized solution to the Travel Rule.
“Until now, the industry has not had an existing infrastructure for VASPs to coordinate and comply with the FATF’s new guidelines. Shyft Network’s solution enables VASPs to fully comply with the Travel Rule,” Samuel Lim, the Chief Compliance Officer of Binance, commented.
Shyft’s open-source network solution reportedly allows counterparties to set up data-sharing rules, while also meeting up with multi-jurisdictional requirements necessary to fulfill global compliance standards. It ensures that they will also adhere to GDPR and other data privacy guidelines.
In addition to complying with the Travel Rule, Binance and other VASPs will be able to minimize risk and data leakages through the network, as all the system operations will equally be conducted in a regulated environment.
Meanwhile, the integration test of the network currently in progress, as the complete deployment will be announced later, per the report. Binance exchange will be the first major integration to drive the implementation of federated coalitions under the Shyft Network’s discovery.
CipherTrace Levels Down The Path
In September, CipherTrace, an American blockchain security company introduced a framework dubbed “travel rule tool,” for digital currency exchanges and wallet providers to enable them to share customers’ information securely and in compliance with FATF’s Travel Rule.
Similarly, during a panel discussion on FATF regulation at the Blockshow Asia conference in November, industry leaders announced the launch of the OpenVASP initiative, an open protocol designed to implement the FATF global cryptocurrency regulation.