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While it is understood that the crypto Travel Rule will prove to be a ‘game changer’, both AUSTRAC and Home Affairs believe more technological development is required for its efficient implementation.
On Friday (27 August 2021) Australia’s Department of Home Affairs announced its agreement with the industry that the government currently does not have the technological capability for implementing a Travel Rule for the crypto sector.
Once implemented, the Travel Rule will require financial institutions to share necessary information in order to enhance transparency in the cryptocurrency space. As mentioned by the Financial Action task Force (FATF), the aim of the Travel Rule is to aid the prevention of criminals using electronically-facilitated funds transfers for moving illegal funds, and for the timely detection of suspicious transactions they occur.
“I think it depends on the way that [the travel rule] is implemented so a technological solution that takes a lot of the legwork out of that would be a game changer. [But] we are not at the point where, globally, there is such a technological solution,” stated Daniel Mossop, the Home Affairs assistant secretary who appeared before the Senate “Committee on Australia as a Technology and Financial Centre” on Friday afternoon.
AUSTRAC’s (Australian Transaction Reports and Analysis Centre) national manager, Bradley Brown, agreed during the hearing and stated that “a solid basis for a technological solution” is required in Australia to facilitate the implementation of the Travel Rule.
Brown’s statement is the latest update on AUSTRAC’s view on the FATF’s Travel Rule.
The committee is currently in the last stages of its inquiry, which is centred around removing barriers in Australia for its growth as a technology and finance centre. The inquiry was initiated back in October 2019.
Suggested Read: Australian Regulators Seeking to Implement Travel Rules for Cryptocurrency