July 26, 2026 • 10 mins
The introduction of AUSTRAC's travel rule has significant implications for cryptocurrency transactions in Australia. From 1 July, AUSTRAC's travel rule means that all transactions through regulated exchanges require identifying information from both the sender and receiver, regardless of the amount. This creates challenges for individuals like Troy Hunt, who faced difficulties when a small crypto donation required extensive reporting, highlighting the complexities of compliance in the current landscape.
In this episode, Peter sits down with Mena, the CEO of CoinStash, to discuss the nuances of the travel rule and its impact on users engaging in staking and crypto transactions. They explore the challenges faced by those receiving staking rewards and the implications of reporting requirements, particularly for amounts as low as $6. Peter provides practical steps for viewers to navigate these changes, emphasising the importance of self-custody wallets and compliance with upcoming regulations.
Chapters:
0:00 The $6 Crypto Problem
0:22 AUSTRAC Travel Rule
0:39 No Minimum Threshold
1:55 Self-Custody Wallets
2:17 Staking Rewards Edge Case
4:34 What Users Can Do
9:15 Self-Hosted Wallet Deadline
9:39 Wrap Up
What you'll learn:
- AUSTRAC's travel rule requires identifying information for all cryptocurrency transactions, regardless of the amount, creating compliance challenges for users.
- Troy Hunt's experience with a $6 crypto donation illustrates the burdensome reporting requirements imposed by the travel rule.
- CoinStash CEO Mena highlights the need for clarity in the reporting process, especially for staking rewards and transactions involving third parties.
- Users are encouraged to set up self-custody wallets to streamline compliance and reduce friction in transactions.
- The travel rule's implementation means that exchanges with robust compliance measures will have a competitive advantage over smaller exchanges.
- Reporting on transfers involving unverified self-hosted wallets will begin on March 31, 2029, providing a limited window for users to adapt.
- The current regulatory environment necessitates a proactive approach to crypto management, including whitelisting wallets and understanding self-custody.
- Staking rewards remain a grey area under the travel rule, with no clear guidance on how to report them effectively.
Links & References:
Troy Hunt X Post on Donation:
- https://link.learncardano.io/EBnk6R
Have I Been Pwned:
- https://link.learncardano.io/PwTOrO
The travel rule:
- https://link.learncardano.io/Z6geXE
Travel rule overview:
- https://link.learncardano.io/XJEeTq
Why am I being asked for additional verification when depositing and withdrawing crypto? (Travel Rule):
- https://link.learncardano.io/p8slOx
How to manually verify a crypto deposit with screenshots:
- https://link.learncardano.io/6YXcp9
Previous Video about the Travel Rule:
- https://link.learncardano.io/HcACJn
Website: https://link.learncardano.io/bQ68Rc
X/Twitter: https://link.learncardano.io/3a1Qtv
Disclaimer: This content is for educational purposes only. Nothing constitutes financial advice.
DISCLAIMER: This content is for informational and educational purposes only and is not financial, investment, or legal advice. I am not affiliated with, nor compensated by, the project discussed—no tokens, payments, or incentives received. I do not hold a stake in the project, including private or future allocations. All views are my own, based on public information. Always do your own research and consult a licensed advisor before investing. Crypto investments carry high risk, and past performance is no guarantee of future results. I am not responsible for any decisions you make based on this content.
🔗 https://www.youtube.com/watch?v=Fq8FhvxET2k
Subscribe to the audio podcast:
🔗 https://bit.ly/learncardano-spotify
🔗 https://apple.co/3jEPM8C
🔗 https://learncardano.io/
Follow on Social:
🔗 https://x.com/learncardano
🔗 https://facebook.com/learncardano
In this episode, Peter sits down with Mena, the CEO of CoinStash, to discuss the nuances of the travel rule and its impact on users engaging in staking and crypto transactions. They explore the challenges faced by those receiving staking rewards and the implications of reporting requirements, particularly for amounts as low as $6. Peter provides practical steps for viewers to navigate these changes, emphasising the importance of self-custody wallets and compliance with upcoming regulations.
Chapters:
0:00 The $6 Crypto Problem
0:22 AUSTRAC Travel Rule
0:39 No Minimum Threshold
1:55 Self-Custody Wallets
2:17 Staking Rewards Edge Case
4:34 What Users Can Do
9:15 Self-Hosted Wallet Deadline
9:39 Wrap Up
What you'll learn:
- AUSTRAC's travel rule requires identifying information for all cryptocurrency transactions, regardless of the amount, creating compliance challenges for users.
- Troy Hunt's experience with a $6 crypto donation illustrates the burdensome reporting requirements imposed by the travel rule.
- CoinStash CEO Mena highlights the need for clarity in the reporting process, especially for staking rewards and transactions involving third parties.
- Users are encouraged to set up self-custody wallets to streamline compliance and reduce friction in transactions.
- The travel rule's implementation means that exchanges with robust compliance measures will have a competitive advantage over smaller exchanges.
- Reporting on transfers involving unverified self-hosted wallets will begin on March 31, 2029, providing a limited window for users to adapt.
- The current regulatory environment necessitates a proactive approach to crypto management, including whitelisting wallets and understanding self-custody.
- Staking rewards remain a grey area under the travel rule, with no clear guidance on how to report them effectively.
Links & References:
Troy Hunt X Post on Donation:
- https://link.learncardano.io/EBnk6R
Have I Been Pwned:
- https://link.learncardano.io/PwTOrO
The travel rule:
- https://link.learncardano.io/Z6geXE
Travel rule overview:
- https://link.learncardano.io/XJEeTq
Why am I being asked for additional verification when depositing and withdrawing crypto? (Travel Rule):
- https://link.learncardano.io/p8slOx
How to manually verify a crypto deposit with screenshots:
- https://link.learncardano.io/6YXcp9
Previous Video about the Travel Rule:
- https://link.learncardano.io/HcACJn
Website: https://link.learncardano.io/bQ68Rc
X/Twitter: https://link.learncardano.io/3a1Qtv
Disclaimer: This content is for educational purposes only. Nothing constitutes financial advice.
DISCLAIMER: This content is for informational and educational purposes only and is not financial, investment, or legal advice. I am not affiliated with, nor compensated by, the project discussed—no tokens, payments, or incentives received. I do not hold a stake in the project, including private or future allocations. All views are my own, based on public information. Always do your own research and consult a licensed advisor before investing. Crypto investments carry high risk, and past performance is no guarantee of future results. I am not responsible for any decisions you make based on this content.
🔗 https://www.youtube.com/watch?v=Fq8FhvxET2k
Subscribe to the audio podcast:
🔗 https://bit.ly/learncardano-spotify
🔗 https://apple.co/3jEPM8C
🔗 https://learncardano.io/
Follow on Social:
🔗 https://x.com/learncardano
🔗 https://facebook.com/learncardano
Listen
Watch
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Six dollars. Six dollars is the amount that someone tipped
Troy Hunt in crypto, and Troy is the guy behind
the website Have I Been Pawned? He's got crypto and
he's got PayPal. But with the crypto side of things,
because someone donated him that's six dollars, he now has
to report on who that person is, that he needs
(00:22):
their n AID, he needs the address, he needs their
birth date. That's an impossible task. So he's going to
ditch the whole crypto side of things and just go
with PayPal. So this creates a brand new problem. And
this is all because of the brand new travel rule
that has come in place from oz Track. And I
sat down with the CEO of Coinstash Manna and he
(00:46):
talks through a couple of things and some holes that
haven't quite been patched yet, especially for anyone that is
earning staking rewards. So if you're delegating your AIDA somewhere,
or you're staking eth or Solana, if you're watching from
the US or Europe, stick around and I'll show you
why in forty seconds. Because these rules are what we're
(01:07):
just catching up to over there in the US. The
FATF section sixteen is what you have over there, and
we're just playing catch up here now. On the first
of July this year, ostrak's new rule switched on, and
this means every Australian transaction that goes in and out
of regulated exchanges needs to have the identifying information from
(01:29):
both sides. Now, this isn't new in principle. This is
just the last part of Australia's anti money laundering laws
that came into play in twenty twenty four, finally switching on.
But here's the part that makes Australia slightly different. There's
no minimum threshold in the US.
Speaker 2 (01:46):
You have a.
Speaker 1 (01:47):
Minimum threshold of three thousand US dollars, so anything below
that you don't have to report where it's coming and going,
but anything above that you do. So Here in Australia,
five dollars requires the same amount of reporting as fifty
thousand dollars. And that's where this six dollars donation really
(02:07):
stuffs things up, because now you suddenly need the person's
birth date from that donation to be able to claim
that six dollars. Now, before we move on, this is
specifically around ostrak's travel rule and not assex digital asset framework,
which will come into play in early next year, in
(02:27):
twenty twenty seven. So just want to make sure that's clear.
Speaker 2 (02:29):
Because his address, his receiving address is too directly to
an exchange. They're saying, where are these funds coming from?
But generally you're receiving funds from yourself or are qualified VASP.
So because people would donate from random places, he needs
to change his addresses on his website to be his
own self hosted wallet and that way there's no friction
(02:51):
on that. But at the same time, the people who
send him funds potentially from an exchange would also need
to declare where they're sending the funds too, So if
they're saying, oh, I'm sending it to Troy, that's going
to be an issue as well, because well, again it
depends on the exchange that you're working with if they
have the ability to send to third parties.
Speaker 1 (03:08):
So now both ends are part of that checkpoint. And
this is the part that isn't really clear.
Speaker 2 (03:13):
So it's usually receiving from myself or receiving from somebody else,
or you can say or I'm sending to myself or
sending to an exchange. The third option well, on the
receiving side, it's the receiving from a crypto mining operation
of sorts. Because it's brand new crypto coins on the chain,
there's no trace ability back to where those coins came from,
(03:36):
so then how do you even know what to do
from there. It was quite an interesting discussion that we
had in the office where people were arguing back and forth,
and then originally it was like, oh, we can't accept it,
and then I was like, no, we'd have to accept it,
even for the fact that it makes no sense that
we shouldn't, but it's because it hasn't been thought up
yet of how to deal with those situations.
Speaker 1 (03:56):
Is that the same way as staking rewards like a
like Cadano for example, the staking rewards coming from delegating
to a staatepool, you get your rewards.
Speaker 2 (04:06):
Ten as a reward that comes out of the blockchain,
the exact same way staking is proof of steak, proof
of work is what I was referring to. On the
mining side, my own SMSF actually earns stoge and light coin.
I have a bunch of script miners, so those coins
coming into my coin sms F acunt in beginning for me,
(04:29):
it was flagged. Is what do we do from here?
Even my dad's mining operations had the same issue, and
he called me up and he says, I don't know
what to click.
Speaker 1 (04:36):
Now, you're aid a delegation, you're staking in awards. The
reards just land in your account. They magically appear from
the protocol. So which one of these do you choose?
You don't have an option here that fits exactly what
is happening, So none of them a protocol paging, there's
no sender, there's no counterparty, there's nothing to declare, there's
no box that fits the mold here. So if you're
(04:58):
staking or even mining cryp bitcoin, there's an edge case here.
So three gotcha's here. The first one, you are now
accountable for money you didn't send. Someone pays you back
from their exchange account, and you're the one being asked
who are they? Troy Hant can't kysee an anonymous anonymous donor,
(05:20):
and you can't kyce your mate. So the second one here,
sending to a third party isn't guaranteed to work. Whether
you can do it at all, it all depends on
your exchange licensing and how much they've spent on compliance.
Same transaction, different exchange, different answer, and then three the
third one here, and this one matters because panic posts
(05:42):
online imply otherwise nothing is being confiscated. The transfer just
hasn't gone yet. It's questionnaire, not a seizure. If you
can't answer it, the funds stay where they are.
Speaker 2 (05:54):
There's two angles you could look at that. The first
would be that you're you're better protected because because when
you look to send funds to an unregistered entity, that
could protect you from losing those funds. The other angle
is obviously that they now know exactly where you're sending
funds and at all times, and you're confirming it on
your end, so it's accountability to movement of funds from you.
(06:18):
So those are the two angles you can look at it.
It's just more formalized now too, and are more transparent
to everyone to see what actually happens.
Speaker 1 (06:24):
So that's the thing that I keep coming back to here.
The monitoring was always there. This isn't new. They were
always tracking what was going in and going out. The
surveillance was always there. What they're doing now is just
making you sign for it.
Speaker 2 (06:39):
Exchangers who are getting the licenses and well, we have
to get the licenses obviously, but also exchanges who aren't
spending more on compliance can can then allow more actions
to be done. Well, we're in the process of getting
more licenses credit license for example, as well, not necessarily
a financial AFSL and then that and then was more
(07:00):
actions to be performed seamlessly for the customer. Yeah, and
we're in the process.
Speaker 1 (07:05):
It'd be clear what's going to happen here. The exchanges
with the biggest budgets and the ones that actually want
to invest in compliance here in Australia, they're the ones
that are going to win out. So we're going to
see a lot of smaller exchanges probably disappear because they
can't afford the compliance work and licenses that are needed
to actually make all this happen for them. Their obvious
(07:27):
fix here that Troy could do for his donation page
was simply to move the donation wallet to a self
custody wallet. Second donation that he's received so far this year,
and it's already July, so it wasn't a big use
case and it wasn't worth his effort even doing it.
Was easier for him just to close down that account
(07:48):
and just simply stop accepting crypto as donations on his website.
So what can you do now? So Troy is just
giving up on the crypto side of things, But what
can you do if you're accepting crypto as payments or
whatever it is, you're accepting money from your friends, your
crypto from your friends. Here are some things that you
can do now, just a preferences. I'm not a fan
financial advisor, I'm not an accountant, not a financial planner.
(08:10):
So the first thing to do is to white list
your self custody wallets on the exchange. Do that now,
don't do it in the future. When you need to
move the funds. You can route all your funds through
your own wallet and you can say always say that
the funds are coming from yourself, your own custody wallet
to the exchange. Three, get your own self custody wallet.
(08:31):
If you are accepting payments and donations, get your own
self custody wallet and publish that one so that money
gets flowed through that particular address. And this is what
Mena recommends as well. The fourth thing here is to
learn about self custody properly, learn how to set up
a wallet securely and safely, and learning self custody is
(08:51):
probably the most important thing about the crypto space in general.
And point five split up your holdings so you can
have a cold wallet to hardware where you're storing your
assets for long term holding, and then your exchange wallet
where you are trading and moving funds. One last thing
before I go. This workaround with self custody wallets has
(09:11):
a clock on it. Yeah, there's a deadline for this
in Australia. So reporting on transfers involving unverified self hosted
wallets starts on the thirty first of March twenty twenty nine,
so that buys you about two and a half years
of clean operation, so it's not forever. And here is
where we are today. No exchange can tell you which
(09:31):
box to tick when the blockchain pays you itself, so
staking rewards are still up in the air when it
comes to the travel rule itself. So leave a comment
down below, guys, let me know what you think. Did
this video make the travel rule clearer for you? Guys?
Ive got YouTube memberships down below. If you want to
support me that way, I've got to buying me your
coffee links there as well. If you want to support
(09:52):
that way, It's a great way to support the channel,
but if you can't, just hit that thumbs up like
subscribe notification belt on your way out, like always, guys,
stay pop that IF and I'll see you in Yeah.
Six dollars. Six dollars is the amount that someone tipped
Troy Hunt in crypto, and Troy is the guy behind
the website Have I Been Pawned? He's got crypto and
he's got PayPal. But with the crypto side of things,
because someone donated him that's six dollars, he now has
to report on who that person is, that he needs
(00:22):
their n AID, he needs the address, he needs their
birth date. That's an impossible task. So he's going to
ditch the whole crypto side of things and just go
with PayPal. So this creates a brand new problem. And
this is all because of the brand new travel rule
that has come in place from oz Track. And I
sat down with the CEO of Coinstash Manna and he
(00:46):
talks through a couple of things and some holes that
haven't quite been patched yet, especially for anyone that is
earning staking rewards. So if you're delegating your AIDA somewhere,
or you're staking eth or Solana, if you're watching from
the US or Europe, stick around and I'll show you
why in forty seconds. Because these rules are what we're
(01:07):
just catching up to over there in the US. The
FATF section sixteen is what you have over there, and
we're just playing catch up here now. On the first
of July this year, ostrak's new rule switched on, and
this means every Australian transaction that goes in and out
of regulated exchanges needs to have the identifying information from
(01:29):
both sides. Now, this isn't new in principle. This is
just the last part of Australia's anti money laundering laws
that came into play in twenty twenty four, finally switching on.
But here's the part that makes Australia slightly different. There's
no minimum threshold in the US.
Speaker 2 (01:46):
You have a.
Speaker 1 (01:47):
Minimum threshold of three thousand US dollars, so anything below
that you don't have to report where it's coming and going,
but anything above that you do. So Here in Australia,
five dollars requires the same amount of reporting as fifty
thousand dollars. And that's where this six dollars donation really
(02:07):
stuffs things up, because now you suddenly need the person's
birth date from that donation to be able to claim
that six dollars. Now, before we move on, this is
specifically around ostrak's travel rule and not assex digital asset framework,
which will come into play in early next year, in
(02:27):
twenty twenty seven. So just want to make sure that's clear.
Speaker 2 (02:29):
Because his address, his receiving address is too directly to
an exchange. They're saying, where are these funds coming from?
But generally you're receiving funds from yourself or are qualified VASP.
So because people would donate from random places, he needs
to change his addresses on his website to be his
own self hosted wallet and that way there's no friction
(02:51):
on that. But at the same time, the people who
send him funds potentially from an exchange would also need
to declare where they're sending the funds too, So if
they're saying, oh, I'm sending it to Troy, that's going
to be an issue as well, because well, again it
depends on the exchange that you're working with if they
have the ability to send to third parties.
Speaker 1 (03:08):
So now both ends are part of that checkpoint. And
this is the part that isn't really clear.
Speaker 2 (03:13):
So it's usually receiving from myself or receiving from somebody else,
or you can say or I'm sending to myself or
sending to an exchange. The third option well, on the
receiving side, it's the receiving from a crypto mining operation
of sorts. Because it's brand new crypto coins on the chain,
there's no trace ability back to where those coins came from,
(03:36):
so then how do you even know what to do
from there. It was quite an interesting discussion that we
had in the office where people were arguing back and forth,
and then originally it was like, oh, we can't accept it,
and then I was like, no, we'd have to accept it,
even for the fact that it makes no sense that
we shouldn't, but it's because it hasn't been thought up
yet of how to deal with those situations.
Speaker 1 (03:56):
Is that the same way as staking rewards like a
like Cadano for example, the staking rewards coming from delegating
to a staatepool, you get your rewards.
Speaker 2 (04:06):
Ten as a reward that comes out of the blockchain,
the exact same way staking is proof of steak, proof
of work is what I was referring to. On the
mining side, my own SMSF actually earns stoge and light coin.
I have a bunch of script miners, so those coins
coming into my coin sms F acunt in beginning for me,
(04:29):
it was flagged. Is what do we do from here?
Even my dad's mining operations had the same issue, and
he called me up and he says, I don't know
what to click.
Speaker 1 (04:36):
Now, you're aid a delegation, you're staking in awards. The
reards just land in your account. They magically appear from
the protocol. So which one of these do you choose?
You don't have an option here that fits exactly what
is happening, So none of them a protocol paging, there's
no sender, there's no counterparty, there's nothing to declare, there's
no box that fits the mold here. So if you're
(04:58):
staking or even mining cryp bitcoin, there's an edge case here.
So three gotcha's here. The first one, you are now
accountable for money you didn't send. Someone pays you back
from their exchange account, and you're the one being asked
who are they? Troy Hant can't kysee an anonymous anonymous donor,
(05:20):
and you can't kyce your mate. So the second one here,
sending to a third party isn't guaranteed to work. Whether
you can do it at all, it all depends on
your exchange licensing and how much they've spent on compliance.
Same transaction, different exchange, different answer, and then three the
third one here, and this one matters because panic posts
(05:42):
online imply otherwise nothing is being confiscated. The transfer just
hasn't gone yet. It's questionnaire, not a seizure. If you
can't answer it, the funds stay where they are.
Speaker 2 (05:54):
There's two angles you could look at that. The first
would be that you're you're better protected because because when
you look to send funds to an unregistered entity, that
could protect you from losing those funds. The other angle
is obviously that they now know exactly where you're sending
funds and at all times, and you're confirming it on
your end, so it's accountability to movement of funds from you.
(06:18):
So those are the two angles you can look at it.
It's just more formalized now too, and are more transparent
to everyone to see what actually happens.
Speaker 1 (06:24):
So that's the thing that I keep coming back to here.
The monitoring was always there. This isn't new. They were
always tracking what was going in and going out. The
surveillance was always there. What they're doing now is just
making you sign for it.
Speaker 2 (06:39):
Exchangers who are getting the licenses and well, we have
to get the licenses obviously, but also exchanges who aren't
spending more on compliance can can then allow more actions
to be done. Well, we're in the process of getting
more licenses credit license for example, as well, not necessarily
a financial AFSL and then that and then was more
(07:00):
actions to be performed seamlessly for the customer. Yeah, and
we're in the process.
Speaker 1 (07:05):
It'd be clear what's going to happen here. The exchanges
with the biggest budgets and the ones that actually want
to invest in compliance here in Australia, they're the ones
that are going to win out. So we're going to
see a lot of smaller exchanges probably disappear because they
can't afford the compliance work and licenses that are needed
to actually make all this happen for them. Their obvious
(07:27):
fix here that Troy could do for his donation page
was simply to move the donation wallet to a self
custody wallet. Second donation that he's received so far this year,
and it's already July, so it wasn't a big use
case and it wasn't worth his effort even doing it.
Was easier for him just to close down that account
(07:48):
and just simply stop accepting crypto as donations on his website.
So what can you do now? So Troy is just
giving up on the crypto side of things, But what
can you do if you're accepting crypto as payments or
whatever it is, you're accepting money from your friends, your
crypto from your friends. Here are some things that you
can do now, just a preferences. I'm not a fan
financial advisor, I'm not an accountant, not a financial planner.
(08:10):
So the first thing to do is to white list
your self custody wallets on the exchange. Do that now,
don't do it in the future. When you need to
move the funds. You can route all your funds through
your own wallet and you can say always say that
the funds are coming from yourself, your own custody wallet
to the exchange. Three, get your own self custody wallet.
(08:31):
If you are accepting payments and donations, get your own
self custody wallet and publish that one so that money
gets flowed through that particular address. And this is what
Mena recommends as well. The fourth thing here is to
learn about self custody properly, learn how to set up
a wallet securely and safely, and learning self custody is
(08:51):
probably the most important thing about the crypto space in general.
And point five split up your holdings so you can
have a cold wallet to hardware where you're storing your
assets for long term holding, and then your exchange wallet
where you are trading and moving funds. One last thing
before I go. This workaround with self custody wallets has
(09:11):
a clock on it. Yeah, there's a deadline for this
in Australia. So reporting on transfers involving unverified self hosted
wallets starts on the thirty first of March twenty twenty nine,
so that buys you about two and a half years
of clean operation, so it's not forever. And here is
where we are today. No exchange can tell you which
(09:31):
box to tick when the blockchain pays you itself, so
staking rewards are still up in the air when it
comes to the travel rule itself. So leave a comment
down below, guys, let me know what you think. Did
this video make the travel rule clearer for you? Guys?
Ive got YouTube memberships down below. If you want to
support me that way, I've got to buying me your
coffee links there as well. If you want to support
(09:52):
that way, It's a great way to support the channel,
but if you can't, just hit that thumbs up like
subscribe notification belt on your way out, like always, guys,
stay pop that IF and I'll see you in Yeah.
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