- bitFlyer has announced that Travel Rule restrictions will apply to TRUST-compatible exchanges across 21 countries.
- The exchange will also permit transactions only for TRUST-compatible cryptocurrencies, including Bitcoin, Ethereum and selected ERC-20 tokens.
- Within Japan, crypto transfers can be made only to and from Coincheck, the country’s other TRUST-compatible exchange.
Japan-based cryptocurrency exchange bitFlyer has announced restrictions on deposits and transfers as it implements enhanced anti-money laundering (AML) measures under the Financial Action Task Force’s (FATF) Travel Rule.
In a notice to users, bitFlyer explained the new measures are intended to ensure the exchange meets Travel Rule obligations.
Under the Travel Rule, crypto platforms must share certain customer information whenever transactions are initiated to or from their services.
bitFlyer said it will restrict transactions involving platforms that do not comply with Travel Rule requirements. These restrictions on crypto deposits and transfers took effect on Tuesday, 30 May 2023.
Restrictions to TRUST-compatible platforms
The Travel Rule Universal Solution Technology (TRUST) is a protocol designed to enable exchanges and other crypto platforms to exchange the required information and comply with the Travel Rule. The initiative was led by Coinbase, a major U.S.-based exchange.
Because the Travel Rule mandates the sharing of sender and recipient details between exchanges, bitFlyer is limiting transfers to TRUST-compliant platforms across 21 countries. Those countries include Japan, Canada, South Korea, Singapore, Israel, Hong Kong, Germany and Switzerland.
bitFlyer also clarified that transfers will be limited to TRUST-compatible cryptocurrencies. Supported assets include Bitcoin (BTC), Ethereum (ETH) and several ERC-20 tokens such as Polygon (MATIC), Chainlink (LINK), Shiba Inu (SHIB) and Maker (MKR).
In Japan, bitFlyer will only support transfers to Coincheck. At present, only BTC is accepted as a TRUST-compatible asset in Japan until Coincheck completes system development to support ERC-20 tokens.
bitFlyer’s policy change follows Japan’s recent adoption of stricter FATF-aligned AML controls under the Travel Rule. The announcement arrives shortly after the FATF urged G7 nations to cooperate more closely in combating money laundering in the digital assets sector.
Separately, major exchanges are continuing to adjust services in response to regulatory changes. For example, Binance has begun transitioning its Japan users to a new regulated platform, Binance Japan.