Crypto glossary
Travel Rule
The Travel Rule is an anti-money-laundering requirement that makes crypto service providers share sender and recipient details when they transfer funds.
The Travel Rule comes from banking, where wire transfers must carry information about who sends the money and who receives it. In 2019 the FATF extended its Recommendation 16 to virtual asset service providers, so exchanges and custodians must collect, keep and pass on names, account or wallet identifiers and, in some cases, addresses for transfers between them.
Each jurisdiction sets its own details. FATF suggests a threshold of 1,000 USD or EUR, the United States applies 3,000 USD under its Bank Secrecy Act rules, and the EU Transfer of Funds Regulation, applicable since 30 December 2024, covers transfers between crypto providers with no minimum amount. Providers use messaging protocols to exchange this data before or alongside the on-chain transaction.
The main friction appears with self-custody wallets, where some exchanges ask users to prove ownership of the address. Different national rules and incompatible messaging standards can delay or block withdrawals between platforms.
Example
If you withdraw 2,000 EUR of USDC from one EU exchange to another, both platforms must exchange your name and account details, and the receiving exchange may hold the funds until that information arrives.
Related terms
Latest articles on Travel Rule
- Thailand Finalizes Crypto Travel Rule as Tough New Compliance Rules Begin in 2027
- Travel Rule Training in 2026: Comparing Crypto Compliance Courses
- South Korea Expands Travel Rule to All VASP Transfers Nationwide
- Taiwan FSC Plans Mandatory Travel Rule Reporting for Every Platform‑to‑Platform Crypto Transfer
- Australia’s Crypto Travel Rule Takes Effect With New Transfer Checks in July
