One of the largest cryptocurrency exchanges Coinbase announced its newest solution called TRUST to ensure customer privacy without voiding the Travel Rule.
With several blockchain platforms striving to become fully decentralized, customers still have concerns about their data privacy. For this reason, Coinbase has been joined by 17 other crypto exchanges to participate in the TRUST privacy solution.
The Travel Rule essentially requires crypto service providers to gather information on their clients and pass on their data to their counterparties. This is done to avoid illegal activity, but could lead to stolen personal information if the crypto exchange gets breached due to a hack.
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According to the official post, the TRUST platform was formed in order to protect customers without disobeying the Travel Rule. Coinbase listed three main safeguards that ensure customer privacy:
- Personal information is not kept in a centralized location. User data, which is required by the Travel Rule, is only kept between the two exchanges that are used for the transaction if they are part of the TRUST platform. Information gets sent via encrypted channels with the receiving end ensuring that the information is stored safely.
- Digital address confirmation. TRUST will require the receiving VASP to ensure that the transaction is correct before sending out customer information.
- AML and privacy requirements. Members of the TRUST platform will have to comply with the usual standards of anti-money laundering (AML), privacy, and security measures.
At the moment, TRUST consists of 18 members including Coinbase, Gemini, Kraken, Robinhood, BlockFi, Bittrex, Paxos, Standard Custody & Trust, Symbridge, Tradestation, Zodia Custody, Zero Hash, Anchorage, BitGo, Circle, Fidelity Digital Assets, Avanti, and bitFlyer.
TRUST will be moving forward by adding more members to the platform to ensure customer privacy amongst all crypto exchanges.
Coinbase has recently appeared on a Super Bowl Ad, offering new users a $15 dollar sign-up bonus. Funnily enough, the crypto exchange briefly crashed due to the number of new users registering onto the platform.
