As a member of this group, PayPal will be one of 38 companies working on compliance with the rule. According to Coinbase representatives cited by cointelegraph.com, adding PayPal to TRUST marks a step forward for the network in its bid to become the global, industry-standard solution for Travel Rule compliance.
The ‘Travel Rule’, also known as the Bank Secrecy Act (BSA) rule 31, dictates that US-based virtual asset service providers are required by law to pass on certain information to the next financial institution in certain funds transmittals involving more than one financial institution. The threshold for identifying fund transfers, and the people behind them, starts at USD 1,000. The rule became effective in May 1996 and was issued by the Treasury Department’s Financial Crimes Enforcement Network (FinCEN).
Following a recommendation from the Financial Action Task Force (FATF) in June 2021, TRUST was launched to streamline reporting and make the sharing of information between virtual asset service providers easier and more transparent. The system relies on two features, namely a centralised bulletin board to identify each VASP party on both ends of a transaction, and an encrypted point-to-point (P2P) channel to securely exchange data.
TRUST was launched in February 2022 by 18 US-based virtual asset service providers (VASPs). Companies such as Coinbase, Paxos, Circle, Kraken, and Robinhood were involved in the project right from the start.
In June 2022, PayPal introduced new features that allowed users to transfer cryptocurrencies to external wallets. Before this introduction, users were able to buy, sell, and hold cryptocurrencies but were unable to move them off the platform.
In the same month, PayPal launched the Business Cashback Mastercard, issued by WebBank and supported by the Mastercard network. This is the first business credit card offered through PayPal, it has no annual fee and rewards cardholders with 2% cashback on all purchases with no rewards earning caps or expiration.
In July 2022, PayPal took part in the formation of a new Economic Opportunity Coalition (EOC) that aims to address economic disparities and accelerate economic opportunity in underserved communities.
The Coalition includes 21 corporations and three foundations that will work together to align major investments in communities of colour with investments made by the Biden-Harris Administration. In 2021, PayPal also joined Vista Equity Partners and Boston Consulting Group in launching the Southern Communities Initiative.
For more information about PayPal, please check out the company profile in The Paypers Company Database.
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