Executive summary
This page provides an overview of crypto-asset transfer regulation and Travel Rule requirements in the European Union. It is intended for Virtual Asset Service Providers (VASPs), Crypto-Asset Service Providers (CASPs), financial institutions, and compliance teams operating in or interacting with the EU market.
The EU’s Travel Rule obligations are implemented through the Transfer of Funds Regulation (EU) 2023/1113 (TFR), aligned with Financial Action Task Force (FATF) Recommendation 16, and operate alongside MiCA, the EU’s harmonised crypto-asset regulatory framework.
This content is provided for informational purposes only and does not constitute legal advice.
Regulatory landscape overview
The European Union has established one of the most comprehensive and harmonised regulatory frameworks for crypto-assets globally. Crypto regulation in the EU is shaped by the interaction of anti-money laundering legislation and sector-specific crypto regulation.
Two frameworks are particularly relevant:
Transfer of Funds Regulation (TFR), which extends Travel Rule obligations to crypto-asset transfers
Markets in Crypto-Assets Regulation (MiCA), which introduces a single licensing and conduct regime for crypto-asset service providers across all EU Member States
Together, these frameworks aim to increase transparency, traceability, and market integrity across the EU crypto ecosystem.
Supervisory and regulatory authorities
Crypto-asset regulation in the EU is coordinated at both EU and national level:
European Banking Authority (EBA): Responsible for AML/CFT oversight and the development of regulatory and technical standards
European Securities and Markets Authority (ESMA): Oversees market integrity and the implementation of MiCA
National Competent Authorities (NCAs): Each Member State designates authorities responsible for licensing, supervision, and enforcement at national level
Crypto-asset service providers must comply with EU-wide requirements as well as applicable national supervisory practices.
Travel Rule status in the European Union
The European Union has formally implemented the Travel Rule for crypto-asset transfers through the Transfer of Funds Regulation, aligning with FATF Recommendation 16.
Under the EU framework:
Travel Rule obligations apply to crypto-asset transfers involving crypto-asset service providers
Required information must accompany qualifying transfers of crypto-assets
Obligations apply to both domestic and cross-border transfers, including those involving non-EU counterparties
This makes the EU one of the first major jurisdictions to operationalise the Travel Rule comprehensively across its internal market.
Timeline and key milestones
June 2023: Transfer of Funds Regulation (EU) 2023/1113 adopted
30 December 2024: Travel Rule obligations become applicable to crypto-asset service providers
2024–2025: Operational implementation and supervisory convergence across Member States
Ongoing: Publication and application of EBA guidance and technical standards
Thresholds and scope
The EU has adopted a zero-threshold approach for Travel Rule obligations between crypto-asset service providers.
CASP-to-CASP transfers: All qualifying transfers fall within scope, regardless of transaction value
Transfers involving self-custodied wallets: Subject to additional requirements above defined thresholds, as set out in regulation
This approach goes beyond minimum FATF standards and has important operational implications for regulated entities.
Required data elements (high-level)
For in-scope crypto-asset transfers, EU rules generally require the transmission and retention of information relating to:
The originator of the transfer
The beneficiary of the transfer
These data categories may include identifying information, account or distributed ledger identifiers, and additional elements as defined in the regulation and supporting guidance. Firms are expected to ensure that required information is transmitted securely and made available to competent authorities upon request.
Local nuances and interpretive considerations
Several characteristics of the EU framework are particularly relevant for compliance teams:
Self-custodied (unhosted) wallets: Transfers involving unhosted wallets are subject to enhanced scrutiny, with additional measures applying above certain thresholds
Data protection: Travel Rule implementation must align with EU data protection requirements, including GDPR
Harmonisation with variation: While rules are harmonised at EU level, supervisory expectations and enforcement practices may vary between Member States
These nuances make jurisdiction-aware and scalable implementation especially important.
Cross-border and interoperability considerations
EU-based crypto-asset service providers frequently interact with counterparties in jurisdictions where Travel Rule implementation may differ or remain incomplete.
This creates operational challenges commonly referred to as the “sunrise issue”, including:
Identifying whether counterparties are regulated entities
Exchanging required information with VASPs operating under different regulatory regimes
Managing differences in implementation timelines and technical standards
Interoperability and accurate counterparty identification are therefore critical for EU-based firms operating internationally.
Indicative compliance readiness checklist
The following considerations are illustrative and non-exhaustive:
Ability to identify regulated crypto-asset service provider counterparties
Processes to exchange Travel Rule information securely and reliably
Controls for handling transfers involving self-custodied wallets
Record-keeping aligned with EU AML requirements
Monitoring of cross-border regulatory differences