Crypto firms have made a step towards FATF compliance following the release of a messaging data standard for the Virtual Asset Service Providers (VASPs).
The initiative has been dubbed ‘IVMS101’ and was pioneered by the Joint Working Group on InterVASP messaging standards (JWG).
This milestone is set to revolutionize how crypto firms will be sharing data with regulators like FCA, FinCEN, MAS, JFSA, and the FATF.
According to the IVSMS101 whitepaper, adopting this standard will facilitate the exchange of KYC/AML information by VASPs in a harmonized manner.
Notably, the project is a product of three key stakeholders with interests in VASPs: International Digital Asset Exchange Association, Global Digital Finance, and the Chamber of Digital Commerce.
Sian Jones, the convener of JWG, has since confirmed that the team’s vision of a standard data model is now a reality:
“I’m pleased to confirm that the working group approved the final text and that the IVSMS101 data model standard now exists,”
InterVASP Messaging Standard, IVSMS101
With this tech in place, all VASPs will be required to integrate the IVSMS101 standard for interoperability and efficient communication.
Basically, the IVSMS101 pegs its underlying design on a universal language that will simplify the process of decoding information shared by ecosystem participants. The paper notes that such an approach, not only enhances regulation but also minimizes the cost of sharing information.
The International Digital Asset Exchange Association (IDAXA) said through an email to Coindesk that the launch of a common standard is a step in the right way since the Virtual Asset guidelines were published by FATF back in June 2019,
“Coming up with the Intervasp Messaging Standard 101 (IVMS101) as a common standard is definitely the first step in the right direction.”
As we approach FATF's one-year progress review, the IVSMS101 standard will be a key topic. Sian Jones has been commended by the Chamber of Digital Commerce for steering and delivering on the project in good time:
“Our members have worked hard to create this standard and achieve consensus in advance of FATF timelines – a real achievement in such a complex area.”
Currently, the standard has already gained traction amongst crypto industry stakeholders with notable firms like TRISA and Sygna Bridge backing the initiative.
Despite the strong value proposition, IVSMS101 has yet to clear the air on how entities in regulated jurisdictions will communicate with those in less strict environments. What is, however, evident is the shift towards the sunrise phase where the industry is seeing more execution based on the plans and designs laid out earlier on.