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Transacting with Self-hosted Wallets as a Swiss VASP

21 Feb, 2024

In collaboration with MME, we produced an overview of self-hosted wallet ownership proof methods available to virtual asset service providers (VASPs) when complying with the Financial Market Supervisory Authority’s (FINMA’s) Travel Rule requirements.

Following the Financial Action Task Force's (FATF) guidance in 2019 for its members to expand their regulatory oversight to include virtual assets and VASPs, Switzerland emerged as one of the first jurisdictions to clarify the applicable requirements through the FINMA and implement its Travel Rule.

Per FINMA, self-hosted wallets fall under the scope of the Swiss Travel Rule. Before initiating any virtual asset transaction or exchange, VASPs must ascertain the beneficial owners of all external wallet addresses, following the same procedures as they do for their clients.

One of the challenges faced by VASPs is transacting with self-hosted wallets while maintaining compliance with regulatory requirements. Together, 21 Analytics and MME have addressed these challenges by providing insights and guidance to Swiss VASPs.