Upbit is Planning to Implement Travel Rules which will Take Effect from March 25

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According to a press release, Upbit, the most trusted global standard digital asset exchange, plans to implement travel rules. Travel rules will be implemented following the amendment to the Act on the Reporting and Use of Specific Financial Transaction Information (referred to as the “Specific Financial Information Act”).

As per the press release, after 00:00 on Friday, March 25, 2022, the method of depositing and withdrawing digital assets will be changed according to the travel rule policy for safe deposit and withdrawal and anti-money laundering. The press release further said to prevent confusion among members due to the changed deposit/withdrawal method after implementing the Travel Rule. Therefore, please refer to the notice in advance. Further details will be provided through a separate notice later.

‘Travel Rule’ is a system for determining where digital assets originate and are headed. Sender information is already recorded in the format required by the International Interbank Telecommunication Association (SWIFT) to prevent money laundering in the existing financial sector.

The International Anti-Money Laundering Organization (FATF) has recommended that digital assets be subject to travel rules in 2019. According to an amendment to the Specific Financial Information Act, the travel rules must be followed in Korea beginning March 25, 2022.

The press release further said that when digital assets are transferred from a virtual asset service provider (VASP) following the travel rule compliance obligation, the receiving virtual asset service provider must receive additional information required for withdrawal. In addition, because international standardisation of travel rules has not occurred, there may be exchanges that do not support deposits and withdrawals at this time.

They noted that virtual asset providers would support deposits and withdrawals verified through the adopted Travel Rule solution or confirmed through different measures. In addition, it will be expanded to include international exchanges, and more information will be provided in a separate notice.

Further, according to Article 6 (3) of the Specific Financial Information Act and Article 10-10 of the same Act’s Enforcement Decree, the press release said that withdrawing digital assets worth KRW 1 million or more based on KRW conversion, additional beneficiary information must be entered. The case of the withdrawal amount’s KRW conversion value is calculated based on the amount of one withdrawal minus the withdrawal fee.

According to the release, restriction on digital asset withdrawal using this function is up to the application of a travel rule solution for withdrawal of OPEN API and restriction on the immediate withdrawal function for Upbit Indonesia and Singapore.

Upbit is considering various measures to comply with current travel rules, such as digital asset deposits and virtual asset operators capable of depositing and withdrawing, and will notify people via separate notice when specific details are finalised. If the member information entered at the time of withdrawal does not match the member information of the virtual asset operator being sent, the withdrawal may be cancelled. Where deposits and withdrawals are made within Upbit, the same can be used even after travel rules are applied in the case of immediate withdrawal and phone number transfer.

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Chaahat Girdhar

I'm Chaahat Girdhar, a journalist by profession who's turning her dreams into vision and vision into reality. I'm curious and have an appetite for gaining new knowledge. So I'm looking forward to learning things in the better way possible.