CoolBitX and Elliptic have partnered to launch Sygna Bridge. a solution for virtual asset service providers (VASPs) to comply with the Financial Action Task Force (FATF) travel rule for crypto.
CoolBitX is a blockchain security company. Elliptic is a crypto risk management firm. The collaboration between the two partners will create an operational Travel Rule solution to comply fully with the FATF’s AML and combating the finance of terrorism (CFT) regulations, according to the two companies.
Recently, FATF released its report describing the conclusions of its 12-month review that assessed the progress that countries and the private sector have made in implementing its guidance on virtual assets. FATF stated that overall, both the public and private sectors have made progress in implementing the revised FATF Standards addressing virtual assets and VASPs.
Michael Ou, CEO of CoolBitX said the blockchain and cryptocurrency industry is at a major crossroad:
“As FATF continues to push its cryptocurrency guidance across the globe, compliance and preventing criminal activity can feel extremely daunting for VASPs. The truth is, ‘Travel Rule’ compliance and blockchain analytics to track criminal activity are two sides of the same coin. Having just one or another paints an incomplete picture. Elliptic’s reputation for helping financial institutions and cryptoasset companies to manage risk through their tracking tools is second to none. With the full range of tools from Sygna and Elliptic, we are thrilled to provide clients with the ability to protect themselves from violating any AML/CFT laws and regulations, allow them to assist regulators to combat illicit money laundering activities, and stay compliant with changing regulations.”
The two companies note that various jurisdictions, such as Singapore and Korea, have already set deadlines for VASPs to meet FATF guidance. The companies claim that in a series of tests and cross-border transfers between SBI VC, Bitsonic, and BitoPro audited by a Big 4 accounting firm, the Sygna Bridge platform demonstrated its effectiveness as a cross-border ‘Travel Rule’ solution.
“The July 2020 FATF report highlights, among other things, that it won’t accept claims of technical infeasibility as an excuse for non-compliance with the Travel Rule – and that it expects VASPs to implement solutions,” said David Carlisle, Head of Policy and Regulatory Affairs at Elliptic. “Now through our partnership with CoolBitX, we can offer customers Sygna Bridge alongside Elliptic’s crypto risk monitoring solutions to help VASPs take proactive steps in meeting high AML/CFT standards, wherever they operate.”
Yoshitaka Kitao, CEO at SBI Holdings his company is delighted to hear of this partnership and they understand the importance of both regulatory compliance and the need for collaboration within the industry—as it will further drive the mainstream adoption of blockchain technology and virtual assets.
In February 2020, CoolBitX announced closed on US $16.75 million Series B funding round, led by SBI Holdings, with participation from the National Development Fund of Taiwan, Bitsonic, and Monex.
CoolBitX reports that a total of 18 exchanges have signed Memorandums of Understandings (MOUs) with them to begin or consider implementing Sygna Bridge, including 6 licensed VASPs from Japan, 1 global exchange group and other VASPs based in Canada, Japan, Korea, Singapore and Taiwan.