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Vasps Meaning

Virtual Asset Service Providers (VASPs) encompass businesses that conduct activities involving digital assets on behalf of customers. Examples include cryptocurrency exchanges, custodial wallet providers, payment processors, and some decentralised finance platforms.

Regulatory bodies such as the Financial Action Task Force (FATF) use the term VASP to categorise entities subject to anti-money laundering (AML) and counter-terrorist financing (CTF) regulations. VASPs must implement know-your-customer (KYC) procedures, monitor transactions, and report suspicious activity to comply with local laws.

The travel rule applies to VASPs, requiring them to share customer information when transferring funds above a certain threshold.

As crypto adoption grows, the definition of VASP continues to evolve, with policymakers seeking to balance innovation with consumer protection and systemic risk mitigation.

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