How to Validate Payer Information in a Virtual Asset Transfer

Why It Matters

In the context of virtual asset transfers, Virtual Asset Service Providers (VASPs) are obligated under FATF Recommendation 16 and jurisdiction-specific Travel Rule implementations to collect, verify, and transmit accurate payer (originator) information. Failure to do so may result in regulatory non-compliance, failed transactions, or reputational harm.

What You Need to Validate

Before initiating a virtual asset transfer, ensure the following payer information is available and accurate:

Full Name of the payer
Wallet Address (or equivalent unique identifier)
At least one of the following:
- Physical Address
- National ID Number
- Customer Identification Number (assigned by the VASP)
- Date and Place of Birth

This information must be obtained, verified against your KYC records, and transmitted to the receiving VASP using a secure, compliant protocol.

Note: Depending on your jurisdiction, simplified obligations may apply for transactions below specific thresholds (e.g. USD/EUR 1,000). Check local laws.

Step-by-Step Validation Process

Red Flags to Watch For

Use of generic or unverifiable names
Discrepancies between declared wallet address and profile data
Reused data across unrelated accounts
Use of anonymous or privacy-enhanced wallets

When to Escalate

If payer information is incomplete, unverifiable, or poses a risk:

Suspend or decline the transaction
Request clarification from the customer
Notify compliance or raise an internal alert

Summary

Validating payer information in virtual asset transfers is a critical compliance obligation that supports transparency, anti-money laundering controls, and cross-border coordination between VASPs. Ensure every transaction is backed by complete, verified payer data—regardless of who manages the technical exchange.