The Travel Rule in Canada: What Your Business Must Know and How to Get Ready
In Canada, the “Travel Rule” has become a critical compliance obligation for any business dealing in virtual assets. This rule mandates that when certain crypto-asset transfers occur, the virtual asset service providers (VASPs) must collect and transmit required data about the sender and recipient. The concept is rooted in the international guidance from the Financial Action Task Force (FATF) and has been implemented in Canada via amendments to the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) regime.
Key Requirements for the Travel Rule in Canada
Under Canada’s regulatory framework, crypto-asset transfers trigger the requirement when they meet or exceed certain thresholds and involve VASPs. For example, when a transfer involves CAD $1,000 or more (or other defined threshold) in virtual currency, VASPs must collect and share sender/recipient information, including names, wallet types, account or reference numbers and the identity of the service providers involved.
The rule is not isolated, it links into other reporting obligations for VASPs, such as the requirement to submit a Large Virtual Currency Transaction Report (LVCTR) when you receive or transmit virtual currency transactions above CAD $10,000.
Why This Matters for Your Business
Failing to comply with the Travel Rule puts your business at material risk. Regulators like FINTRAC are increasing scrutiny of virtual-asset compliance programs. Gaps in sender/beneficiary data, weak monitoring of crypto transaction flows, inadequate policies and procedures or missing records may lead to significant administrative penalties or enforcement action.
How Your Business Should Respond — Using Platino Consulting’s Expertise
To stay ahead, your business should take the following steps, and our consulting team is ready to help you do this effectively:
Map your flows: Identify all token transfers, where money enters and exits your systems, and which transfers cross VASP or wallet-provider boundaries.
Define triggered transfers: Determine which transactions fall under the Travel Rule threshold, e.g., CAD $1,000 or more for sender/beneficiary data, CAD $10,000 or more for LVCTR filings.
Implement data collection & sharing workflows: Design workflows that ensure required sender/recipient data is collected, stored, and transmitted seamlessly to other VASPs or regulators, with reliable audit trails.
Enhance your monitoring and control framework: Use monitoring software or build rule-sets that flag transfers without required data, high-value or unusual wallet behaviour, layering or chain-hopping.
Develop robust policies documentation & training: Your written policies and procedures should reflect the Travel Rule and related crypto-asset obligations. Staff and agents must receive training and your program should be reviewed for effectiveness.
Platino Consulting’s consultants are licensed in crypto investigations, experienced in blockchain forensic analysis, and steeped in the Canadian AML/CTF regulatory framework. Contact us if you need support to build or refine your Travel Rule compliance program from initial gap assessment to full implementation and ongoing monitoring so you can operate confidently, scale your business and stay ahead of regulatory enforcement.
