While the revolutionary technology underpinning the digital asset industry has become more established, the rules U.S. regulators have used to police the industry are outdated. The White House is starting to notice, issuing a March 9, 2022 Executive Order directing federal agencies to recommend policies and regulations to address the growing digital asset sector, thus far, the industry has not seen significantly evolving regulation. For example, one question often asked in this space is whether digital assets are securities regulated by the U.S. Securities and Exchange Commission pursuant to the Howey test—a 1946 case involving an investment in orange groves—or are they mediums of exchange regulated by the U.S. Commodity Futures Trading Commission.

Driven by what the digital asset community views as a failure on the part of regulators to appropriately set out the rules of the road, various cryptocurrency platforms have taken the dynamic step of seeking to recommend uniform standards that cryptocurrency providers can use to ensure compliance with Anti-Money Laundering (AML) laws and regulations. Last month a consortium of 18 cryptocurrency platforms took steps to chart out the rules of the road with respect to the so-called "Travel Rule," which requires financial institutions to share certain basic transaction and customer information when sending funds over a certain amount to another financial institution. The consortium banded together to create the Travel Rule Universal Solution Technology (TRUST), a platform that allows participating exchanges to securely collect and transmit customer data in accordance with the Travel Rule. TRUST describes its platform as an "industry-driven solution" designed to achieve "top-tier compliance" with the Travel Rule. As described below, TRUST represents a significant step forward for companies in the digital asset space and shows that the industry is rapidly maturing and being proactive about the inevitable need for further regulation.