What is the travel rule for crypto?

The travel rule is an important development within the crypto market related to regulation and transparency. As cryptocurrencies are increasingly used by the general public, so does the need for governments to have clear rules to safeguard the security of the financial system.

The travel rule ensures that certain personal data "travels along" with a transaction between different parties. This may sound technical, but it has direct consequences for anyone who owns or trades crypto via an official platform. In this article you will learn what the travel rule is exactly, how it works under the latest MiCA and TFR directives and what you notice as a user in 2026.

In short

• The travel rule is an international standard that requires information about the sender and recipient to be shared during crypto transactions.

• The rule was drawn up by the FATF (Financial Action Task Force) and anchored in the EU in the Transfer of Funds Regulation (TFR).

• Since 1 January 2026, the rules have been tightened: all transactions between exchanges fall under it, regardless of the value.

• The rule applies to Virtual Asset Service Providers (VASPs), such as Dutch exchanges and brokers.

• For you as an investor, this means extra verification steps when sending or receiving crypto to external addresses.

What is the travel rule?

The travel rule is an obligation whereby crypto providers must send along specific information when they carry out a transaction for a customer. This rule has existed for decades in the traditional banking world (think of international bank transfers via SWIFT) and has been translated by regulators to the crypto sector.

The main goal of the travel rule is to create transparency. By knowing who the sender and who the recipient is, authorities can more effectively counter abuse of the financial system — such as money laundering and terrorist financing.

Origin: FATF Recommendation 16

The travel rule stems from Recommendation 16 of the Financial Action Task Force (FATF). This is a global organisation that sets the standard for combating financial and economic crime. The FATF advised countries to treat crypto platforms the same way as banks. In the European Union, this advice has been converted into binding legislation via the Markets in Crypto-Assets (MiCA) regulation and the associated Transfer of Funds Regulation (TFR).

What exactly "travels" along?

In a transaction between two regulated platforms, the following data must be securely exchanged:

• The full name of the sender and the recipient.

• The official residential address or an identification number (such as a passport number) of the sender.

• The account or wallet address of both parties.

Important to know: this information is not placed publicly on the blockchain. The data is shared directly between the two involved crypto providers via encrypted channels.

Who does the travel rule apply to?

The travel rule primarily targets companies that offer professional services around digital assets.

What is a VASP?

A VASP stands for Virtual Asset Service Provider. These are companies that facilitate crypto transactions. Think of:

• Large crypto exchanges where you trade.

• Brokers that act as intermediaries.

• Providers of custodial wallets.

In 2026, these parties must have a MiCA licence and be supervised by the AFM (Dutch Authority for the Financial Markets) or DNB (Dutch Central Bank) in order to legally offer their services.

Threshold: the "zero threshold" in 2026

In the past, the FATF used a threshold of 1,000 euros, below which the rules were less strict. However, the European Union has put a line through this. Since the full implementation of the TFR, a threshold of 0 euros applies for transactions between exchanges. This means that with every transfer, however small, the travel rule applies when you send from one exchange to another.

Hosted vs. unhosted wallets

One of the most discussed topics within the travel rule is the handling of your own wallets, also called "unhosted wallets".

What is a hosted wallet?

A hosted wallet is managed by a platform. When you store crypto on a platform such as Coinmerce, you use a hosted wallet. The platform manages the technical keys (private keys) for you. Transactions between two hosted wallets fully follow the travel rule protocols.

What is an unhosted wallet?

You manage an unhosted wallet entirely yourself. Think of a hardware wallet (such as a Ledger) or a software wallet on your phone (such as MetaMask). You are the only one who owns the private keys.

Transactions to your own wallet

When you send crypto from an exchange to your own hardware wallet, additional rules apply in 2026:

• Identification: The platform may ask you to prove that the external wallet actually belongs to you (for example, via a screenshot or a small test transaction).

• 1,000 euro rule for unhosted wallets: For transactions above 1,000 euros from or to an unhosted wallet, the exchange is obliged to technically verify whether the customer is the owner of that wallet. This is intended to prevent anonymous wallets from being used for large-scale illegal transactions.

Travel rule in the EU: MiCA and DAC8

In 2026, the landscape for Dutch crypto holders has changed considerably due to the introduction of MiCA and the new DAC8 directive.

What changed as of 1 January 2026?

In addition to the travel rule, the DAC8 directive also came into force on 1 January 2026. Whereas the travel rule focuses on anti-money laundering, DAC8 focuses on tax transparency. Crypto providers are now obliged to automatically share their customers' transaction data with the Tax Authority. This data is exchanged within the EU, making it much easier for regulators to check whether crypto holdings are correctly declared in box 3.

Impact on Dutch exchanges

Dutch providers must comply with the strictest compliance requirements in the world. This ensures a "level playing field" where unreliable providers without a licence are kept off the European market. For you, this means that you trade with parties that meet strict security standards and reserve requirements.

Advantages of the travel rule for the crypto market

Although the extra checks are sometimes experienced as cumbersome, the travel rule brings important advantages for the maturation of the sector:

• Mass adoption: Because crypto complies with the same rules as traditional banking, more pension funds and institutional investors dare to step in.

• Protection against fraud: Identifying recipients makes it much harder for scammers to anonymously siphon off stolen crypto.

• Integration: It becomes easier to send money back and forth between your bank account and your crypto account, because both systems now "speak the same language" in terms of security.

Frequently asked questions

Why do I have to provide my residential address for a withdrawal?

Under the travel rule, the platform is obliged to send along the sender's address to the receiving party. Without this information, the transaction may not legally be carried out.

How much crypto can you have tax-free in 2026?

In the Netherlands, a tax-free allowance of 59,357 euros applies for 2026 (double for partners). If your total wealth in box 3 — including your crypto at exchanges and in your own wallets — exceeds this amount, you owe tax. Thanks to DAC8 and the travel rule, the Tax Authority now has a more direct view of this.

Do these rules delay my transaction?

In most cases, no. Large platforms use automated systems to send along the required data immediately. Only with unusual transactions to unknown unhosted wallets can a manual check take place that causes some delay.

Want to trade on a platform that fully complies with the latest legislation, so that you are not caught off guard? At Coinmerce you can safely buy and manage cryptocurrencies within a regulated environment that continuously responds to the latest developments of the travel rule.