ING Bank, the Netherlands-based lender with a penchant for blockchain, has developed a protocol to help with the Monetary Motion Activity Drive’s Journey Rule requirement for crypto exchanges and corporations dealing in digital property.
The answer initiated by ING – at present dubbed the Journey Rule Protocol or TRP – has additionally been backed by Normal Chartered Bank, Constancy Digital Belongings and BitGo, plus a gaggle of different acquainted corporations from the crypto area.
The FATF’s suggestion in October 2018 to incorporate digital asset service suppliers (VASPs) inside the scope of its anti-money laundering mandate has spawned a raft of technical options and a messaging commonplace.
Nonetheless, that is the primary time any bank has been concerned in a crypto Journey Rule answer.
Learn extra: Contained in the Requirements Race for Implementing FATF’s Journey Rule
The institutional centered TRP was additionally partly backed by the InterVASP working group which launched the IVMS-101 commonplace, a manner VASPs can agree on the format of the message payloads their options will switch.
In keeping with a TRP doc seen by Fintech Zoom:
“We are proposing a collaboratively-managed infrastructure that offers VASP members a way to query for the existence of address entries. An address entry is defined by, among others, an LEI [Legal Entity Identifier] and public key information.”
ING Bank, Normal Chartered and Constancy didn’t return a request for remark by press time.
A supply near ING mentioned the bank began taking a look at options to the FATF’s “Recommendation 16” for digital property final yr.
The plan was to “get an understanding of where the industry is going and see what the opportunities would be for banks when they can play in that space,” mentioned the supply.
“To be clear, ING is not looking at doing anything with crypto assets and payment tokens like bitcoin,” mentioned the supply. “The focus, for now, is more on security tokens and things like that.”
The protocol contains a RESTful (Representational State Switch) API, which is principally a manner of transferring knowledge from one place to a different on the web. Taking part VASPs should have the ability to publish handle entries; by doing so that they affiliate an identification and knowledge linked with that handle entry, the paper says.
“You could compare it more to SWIFT,” mentioned the banking supply, referring to the interbank messaging system that’s been in place because the 1970s. “It could be used for private purposes or be open-sourced code and be adopted by people as a way to exchange that transaction information.”
ING is understood to be extremely revolutionary with regards to blockchain, getting deeply concerned in privacy-enhancing tech like zero-knowledge proofs. However this has all the time been on the enterprise aspect of issues.
Learn extra: ING Bank Is Bringing Bitcoin ‘Bulletproofs’ to Personal Blockchains
The takeaway from this Journey Rule “experiment” is that banks like ING and UK.-based Normal Chartered Bank are quietly edging nearer in the direction of the world of crypto and controlled digital asset service suppliers (VASPs).
Different contributors within the TRP working group embody Crypto Dealer AG, Metaco, 21 Analytics and OSL / BC Group, in line with the paper.
Pelle Braendgaard, CEO of not too long ago launched FATF Journey Rule answer Notabene, mentioned his workforce could be supporting ING’s TRP answer.
“Judging by the members, the protocol will probably become important,” mentioned Braendgaard.
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