Beneficiary

The beneficiary is the natural or legal person who receives or is identified to receive a virtual asset transfer, for whom the beneficiary Virtual Asset Service Provider must collect, verify, and maintain identifying information under FATF Travel Rule requirements.

Under FATF Recommendation 16 as revised in June 2025, beneficiary VASPs must obtain and verify beneficiary information including name and account number or unique transaction reference. The beneficiary VASP must receive originator information from the originating VASP, verify beneficiary identity, maintain records of both originator and beneficiary data, and screen the information against sanctions lists and other risk indicators before crediting the transfer.

Beneficiary VASP obligations include detecting missing or incomplete originator information transmitted with transfers, implementing risk-based procedures for handling transfers with incomplete data including potential blocking or filing suspicious activity reports, and maintaining transaction records for at least five years. When beneficiaries use unhosted wallets rather than VASP accounts, the sending VASP still must collect beneficiary wallet address and conduct enhanced due diligence on the transfer. Travel Rule compliance requires beneficiary VASPs to implement technical solutions receiving and processing customer data transmitted by originating VASPs through standardized protocols or bilateral arrangements. Non-compliance with beneficiary obligations can result in regulatory enforcement, monetary penalties, and restrictions on cross-border transaction capabilities.