KYC anti-money laundering provider Netki has announced an overhaul in its digital ID service to incorporate the Financial Action Task Force’s controversial “travel rule” mandate for crypto exchanges.
According to the announcement made on Sept. 9, Netki has upgraded its TransactID to comply with the FATF’s strict regulations for combating money-laundering through cryptocurrencies and exchanges. Specifically, the upgraded service will allow for the break down of user certificates into smaller pieces of personally identifiable information and implement a service for senders and receivers of money to request such identifiers.
The FATF ruling, which was passed in June amidst controversy and industry backlash, will make cryptocurrency exchanges responsible for users transferring funds between platforms. In addition to collecting extensive personal information on users, crypto exchanges will be required to share client information when transfers are initiated. While the FATF claims that such measures will combat money laundering, many industry analysts believe the mandate will hinder user privacy.
Justin Newton, CEO of Netki, told CoinDesk,
“Before, there was, like, one large, atomic transaction where each side shared all of the information about each other with each other. Now the protocol allows for more of a conversation where each side can request and share individual pieces of identity information with each other.”
While the FATF mandate is more a set of guidelines than by-laws, with a twelve-month deadline, the 37 member countries are expected to implement them through increased regulation leading up to June 2020.