Crypto exchanges will share user information

Robert Hoogendoorn
Jun 22 · 2 min read

Cryptocurrency exchanges are likely to share user information between each other. This is an advice from the Financial Action Task Force (FATF) in their effort to combat money laundering and other illicit activities. These rules also apply to banks, and can result in certain individuals being blacklisted from using crypto exchanges.

FATF is an influential consortium which represents 38 countries worldwide. This organization gives advice, which normally would be applied in individual countries as a local law.

Cryptocurrency exchanges will be labelled as ‘virtual asset service providers’ (VASP). For the future this will mean that exchanges require to log the following information for each transaction:

  1. Name of the sender
  2. Account / wallet from the sender
  3. Address of the sender
  4. ID number or customer number
  5. Name of the person who receives the money
  6. Account number / wallet from receiver

It’s not yet clear how this information will be logged by exchanges and how this technically would work. Especially details from the receiver will be difficult to log.

At the same time the definition of the VASP is still very unclear. There’s no mention of decentralized exchanges, as these are only facilitators for a trade. They don’t store anything themselves. According to the FATF a VASP is defined as a company that does one or more of the following activities:

  1. Exchanging between virtual assets and fiat money
  2. Exchanging between one or more virtual assets
  3. Sending virtual assets
  4. Storing or logging virtual assets
  5. Supplying financial services related to buying or selling virtual assets

Now it’s up to local governments to apply these rules. The FATF is giving governments 12 months to adopt the guidelines. It will review these new rules in June 2020.

The countries that are part of the FATF are: United States, United Kingdom, Argentina, Australia, Austria, Belgium, Brazil, Canada, China, Denmark, Finland, France, Germany, Greece, Hong Kong, Iceland, India, Ireland, Israel, Italy, Japan, Korea, Luxembourg, Malaysia, Mexico, The Netherlands, New Zealand, Norway, Portugal, Russia, Saudi Arabia, Singapore, South Africa, Spain, Sweden, Switzerland and Turkey.


Originally published at NEDEROB.