CA Crypto Advisory: Thoughts on Liechtenstein's Travel Rule

This is why we invited Maurice:

Liechtenstein's deadline for Travel Rule adoption is approaching, but there is still a lot to uncover. Who better to explain the impacts of the requirements than advisors on the topic in the country? This is why we partnered with CA Crypto Advisory AG and asked them all you wanted to know about the changes for VASPs after the deadline on April 1st.

CA Crypto Advisory AG is our partner based in Liechtenstein that advises and supports companies in compliance and blockchain. The company was founded by three individuals with proven experience in the related tasks and challenges in crypto compliance. Maurice Satzer, one of the founders, has a bachelor's in business law, which empowered him to work for a trustee and as a compliance officer at the large crypto exchange Bittrex Global. He spoke to us to share his views on the Travel Rule.

21 Analytics: Is the Financial Action Task Force (FATF) Travel Rule good or bad for the overall crypto ecosystem?

The rapid increase in the use and popularity of cryptocurrencies in recent years has shown that cryptocurrencies also provide opportunities for money launderers and terrorists to commit crimes with virtual assets. The Travel Rule is then intended to combat money laundering and terrorist financing, help financial authorities detect and prevent money laundering activities related to cryptocurrencies. From a compliance officer's perspective, this regulation is indispensable. Cryptocurrencies and blockchain technology are remarkable innovations that must be protected from misuse.

21 Analytics: How do you think the FATF Travel Rule will impact the day-to-day operations of a compliance officer?

The Travel Rule will create an additional day-to-day task for the Compliance Officer. As with all new regulations, the obligations must be analyzed in advance. In addition, strategic decisions must be made. Especially when it comes to larger VASPs, automated solutions have to be implemented, which is why it is very positive that 21 Analytics has developed a technical solution.

21 Analytics: What advantages and disadvantages are there for VASPs in countries that adopt the FATF Travel Rule first?

It may be that, after implementation, it becomes apparent that the regulation needs to be improved because it is too unclear, not fully implementable, or partially misses its target. VASPs in countries that adopt the FATF Travel Rule first could serve as a guinea pig in some circumstances. On the other hand, they already face challenges that other countries will face as well. However, given that there will be further regulation in the future, it could be an advantage if a major regulation could already be implemented and the risk of being hit by a huge wave of regulation is minimized. 

21 Analytics: Should a compliance officer argue with VASP’s management for an early adoption of a FATF Travel Rule solution? If so, how?

It is certainly useful to monitor current legal developments. However, as long as it does not negatively impact actual business operations, I would wait for national law implementation for reasons of legal certainty.

21 Analytics: What is one thing that VASPs in countries that will soon implement the FATF Travel Rule could learn from Liechtenstein's adoption?

I think a big advantage of Liechtenstein is the open communication from all parties involved. The exchange between the financial market participants and the regulator is extremely important for both sides to establish an appropriate and implementable solution. Due to the size of the financial market, smaller financial market participants can also be taken into consideration or contribute their recommendations/findings.

The insights from CA Crypto Advisory AG bring some clarity on what to expect as a compliance officer in a VASP based in Liechtenstein. The main challenge of understanding the requirements and turning that into strategic decisions remains but will be minimized over time with regulatory clarity and solutions like 21 Travel Rule that ease VASPs' operations.

Any more questions? Ask Crypto Advisory directly. And if you want to know more about where to start complying with the FATF Travel Rule, reach out to us at 21 Analytics.

About Maurice Satzer:  

Maurice Satzer started his professional career in 2011 in Liechtenstein with a Wealth Advisor. After completing his bachelor's degree in business law and working for a medium-sized trustee and a large crypto exchange, he and his two current business partners decided to found CA Crypto Advisory AG. 

About CA Crypto Advisory AG: 

CA Crypto Advisory AG is a company based in Liechtenstein and advises and supports companies in the area of compliance and blockchain and all related tasks and challenges. The company was founded by three individuals with proven experience in compliance and crypto.