PayPal has taken the bold step of joining the TRUST ecosystem to strengthen its cooperation with regulations. The payment platform is now one of the 38 members of the Travel Rule Universal Solution Technology ecosystem.
PayPal Joined The TRUST Network To Comply With The Travel Rule
According to the report, PayPal recently joined the company of other big firms that offer crypto-related products in the TRUST network to comply with the travel rule. The giant crypto-friendly payment platform joined to show its compliance with regulators as it ventures deeper into the crypto industry.
Furthermore, PayPal has been showing strong interest in the blockchain space since 2020, when it ventured into selling and buying digital assets within its platform. Afterward, it integrated its forum with protocols that offer crypto transactions between PayPal and other crypto wallets in June 2022.
Recently, Paypal announced to have joined the TRUST network, completing the 38th member of the group that started with 18 firms. According to reports, Coinbase, Kraken, Paxos, and 15 other American virtual assets service providers formed TRUST in February. Their number has grown since then.
Earlier today, August 23, Coinbase announced that welcoming PayPal into TRUST is another feather in the group’s cap. He added that the group aims to be a worldwide industrial solution for Travel Rule adherence.
Crypto Firms Formed TRUST To Comply With Regulator
The Travel Rule is a common name for rule 31 under the Bank Secrecy Act. It obligates every American firm offering digital asset services to release specific transaction data from one financial firm to another.
It entails that any transaction that is above $1000 should be reported to the appropriate quarter to curb fraudulent activities. To that effect, some virtual assets services providers in America came together to form the TRUST network.
It helps them to report necessary data and facilitates transparency and information distribution among them. TRUST functions on two main components.
First, it highlights the two members of the group who are involved in a transaction through a general bulletin board. It also encrypts the P2P channel used for efficient and secure data transfer.
In June last year, the Financial Action Task Force requested digital assets providers to create a framework that would help crypto firms worldwide to comply with agencies fighting money laundering and terrorist financing. Responding to the request, the group created the TRUST ecosystem.