This article explains everything you need to know about the Travel Rule, including what this regulation is, why it is necessary, and how it affects your crypto transactions on Bitpanda to keep your assets secure and fully compliant with global financial standards.
What is the Travel Rule?
The Travel Rule is a regulatory requirement established by the Financial Action Task Force (FATF), an international organisation dedicated to combating money laundering and terrorist financing. It is one of the key measures in financial regulation aimed at increasing the transparency and security of financial transactions.
The EU Regulation 2023/1113 on the transfer of funds and certain crypto-assets has revised Regulation (EU) 2015/847, extending its scope to include the transfer of specific crypto-assets.
Why is the implementation of the Travel Rule necessary?
The implementation of the Travel Rule is essential to comply with legal and regulatory requirements for combating money laundering and terrorist financing. Regulatory authorities mandate that VASPs (virtual financial service providers) including Bitpanda monitor the origin and recipient of transactions to ensure they are not used for illegal activities.
This is consistent with existing practices in the traditional banking sector, where similar requirements apply to the transmission of financial data. Adhering to the Travel Rule is crucial to avoid legal consequences and to continue operating in regulated markets and enhance the safety of our community. Additionally, by complying with these regulations, Bitpanda helps maintain the integrity of the financial system and strengthen trust in the cryptocurrency market.
How does the Travel Rule affect you as a customer?
As a regulated platform, Bitpanda fully complies with the Travel Rule. This means we need to collect and share certain information about your crypto transactions.
This affects both individual and business customers when conducting transactions to and from other platforms that are also subject to this regulation, as well as transactions to and from self-hosted wallets.
What does this mean for you?
- Additional information: When you conduct transactions through Bitpanda, we will need to collect additional information about the senders and recipients, including those on other crypto platforms as well as self-hosted wallets. This includes your name, address, and other relevant details.
- Transparency in transactions: The information we collect will be shared with the respective financial institutions to ensure compliance with all legal requirements.
A more secure experience: While your daily operations remain smooth, there are new data requirements and some restrictions on specific types of transfers (like sending to third-party private wallets or business accounts). This ensures you can continue trading in a fully regulated and safe environment.
FAQ
Sending crypto (withdrawals)Recipient names, wallet hosts, and sending to private wallets
To comply with these regulations, we must include the names of both the sender (originator) and the recipient (beneficiary), along with their respective wallet addresses. This ensures the crypto ecosystem remains secure, transparent and compliant with international safety guidelines.
What to do if you don't have this information: If you don't know the recipient’s full legal name, you will need to ask the recipient before you complete the transfer.
What is a "Wallet host"? A wallet host is the company or platform that manages the wallet address (and controls the private keys) that you are sending crypto to or receiving crypto from. Common examples include centralised exchanges or brokers, like Bitpanda.
How do I choose?
- Exchanges or crypto apps: If the counterpart uses an exchange or a crypto app, select that specific platform from the list.
- Self-hosted wallets: If the wallet is managed independently and the private keys are controlled by the user (for example on Ledger, Trezor, or MetaMask), select "Self-hosted wallet." *
Not sure? Just ask the recipient, which app or device they use.
Important note on receiving crypto: To ensure the highest security standards, we only accept deposits from a "Self-hosted wallet" if you are the verified owner of that wallet.
To ensure the highest security standards we only support withdrawals to private wallets (also known as self-hosted wallets) that you personally own.
What can I do instead?
Ask your friend for their deposit address on a regulated exchange or crypto app. Transfers between two regulated platforms are straightforward because the required Travel Rule data is securely exchanged automatically between the two platforms. You can send funds there without any issues!
Receiving crypto & stuck depositsWhat to do if your deposit is rejected or paused
To maintain high security standards and manage these verifications, we only accept deposits from private wallets if you are the verified owner.
If we cannot confirm that the sending wallet is yours, we are unable to credit the deposit to your account and need to refund the amount back to the source.
Status of your funds: Your funds have been securely received by Bitpanda but are currently on hold. They have not been lost.
How to process a refund Please follow these steps to have the amount refunded directly to your original wallet:
Once confirmed, you can view the refunded transaction as follows:
- Go to Transaction history again
- Find the refund in the general transaction history
Wallet verifications & security checksUnderstanding the €1,000 limit and message signing
Why is my transaction "Pending" or "Paused"? Your transaction involves a self-hosted (private) wallet and has reached the €1,000 verification threshold set out in the EU Transfer of Funds Regulation. Because of this, a quick security check is required to verify that you own the address before we can proceed.
What does this mean?
- It is not a spending limit: You can still send or receive more than €1,000.
- It is not cumulative: We check every transaction separately. If the transaction is ≥ €1,000 and this address is not previously verified, then the transaction is on hold and needs to be verified.
Action required
Check your email or push notifications and follow the link to "Verify wallet". You can also find the verification prompt directly in your app's notifications.
For step-by-step instructions on each method, please read our dedicated guide.
I already verified a wallet before. Why am I being asked again? Verification is linked to a specific wallet address, not to your device or wallet app.
How address verification works
- Dynamic addresses: Many wallets (especially Bitcoin wallets) automatically generate a new address for each transaction to protect your privacy.
- Regulatory requirements: Under current regulations, each new address is treated as a separate wallet. We are required to verify it independently once the €1,000 threshold is reached.
Good to know: This does not mean anything is wrong with your account. It is simply the regulation working as designed. Once the new address is verified, you will not be asked about that particular address again.
General education & privacyHow the Travel Rule protects your data
Can I still send crypto to other exchanges? Yes! Transfers between two regulated crypto platforms are the most straightforward type of transaction under the Travel Rule. Both platforms are legally required to collect and exchange the sender and recipient information.
How to do it
Please note: In rare cases, a transfer may be delayed or declined if the receiving platform is not yet Travel Rule compliant. If this happens, feel free to contact us and we will be happy to explain the situation in more detail.
What information will Bitpanda collect? The EU Transfer of Funds Regulation specifies the exact data that must accompany a crypto transfer. Here is what is required:
About you (the sender):
- Full legal name
- Your wallet address
About the recipient You will be asked to provide:
- Their full legal name
- The wallet address you are sending to
- The name of the platform hosting their wallet (or confirmation that it is a self-hosted wallet)
What happens if I do not provide the additional information? Under the EU Transfer of Funds Regulation, we are legally obligated to pause or decline a transaction if the required sender or recipient information is missing or incomplete.
- For withdrawals (sending crypto): Your transaction will not be submitted until all required fields are completed. No crypto will leave your account.
- For deposits (receiving crypto): If you do not include the required information about the sender, or if a self-hosted wallet has not been verified, the incoming deposit may be paused until the required information is provided.
What do I need to do to comply? In practice, there will be little changes for you. When you send or receive crypto on Bitpanda, you may be asked to provide or confirm some basic details, such as the full name of the recipient and their wallet address.
Key steps for a smooth transfer:
- Double-check your entries: Ensure that all the information you enter is accurate and complete.
- Avoid delays: Incorrect details may cause delays or prevent the transaction from being processed.
If you have any further questions, you can always contact our support team.
Will this information be shared with third parties? Your information will only be shared with the other regulated financial institution directly involved in your transaction. This is a legal requirement under the Travel Rule as defined by the FATF.
It is important to understand that:
- Your data is not shared with random third parties, advertisers, or anyone unrelated to the transaction.
- The sharing happens through secure, encrypted channels.
- Both the sending and receiving institutions are legally obligated to handle your data with the highest level of confidentiality and in line with applicable data protection laws.
Think of it the same way your bank shares your details with the receiving bank when you make a wire transfer. It is a controlled, regulated, and secure process.
Will my personal information be visible on the blockchain? No, absolutely not. The blockchain and the Travel Rule processes are completely separate.
- On the blockchain: Only transaction amounts and wallet addresses are recorded. It does not contain your name, email, or any personal details.
- Through the Travel Rule: Information such as your name is sent privately and securely through encrypted channels directly between the two regulated institutions involved in the transfer.
At no point is your personal information written to, stored on, or visible on the blockchain. Your personal data stays entirely off-chain and is handled with the same level of confidentiality as a traditional bank transfer.
How long will my data be retained? The retention period for data collected under the Travel Rule depends on the legal requirements that apply to Bitpanda.
This data is kept solely to:
- Meet legal and regulatory obligations.
- Support law enforcement investigations if required by a competent authority.
- Ensure a complete audit trail for compliance purposes.
Once the legally required retention period has expired and there is no further legal basis for keeping the data, it will be handled in accordance with our Privacy Policy.
What is "Travel Rule" and why does it affect my crypto transfers? The Travel Rule is a global regulatory standard that requires regulated crypto service providers to collect and securely share basic identifying information (such as your name and wallet address) when you send or receive crypto.
The purpose of the rule
It is designed to make the crypto ecosystem safer, more transparent and harder to misuse for illegal activity.
How it affects your transfers
- Similar to traditional banking: Whenever you send a standard wire transfer, your bank passes along basic sender and recipient details to the receiving bank. The Travel Rule simply extends this exact same principle to crypto.
- No changes to your crypto: The rule does not change what you can do with your funds. It simply means that a small amount of identifying information now "travels" alongside your transaction between regulated providers.