The General Data Protection Regulation (GDPR) and Travel Rule

TL;DR

• The GDPR establishes strict rules for the collection, processing, storage, and protection of personal data across the EU.
  
  
• Article 5 of the GDPR sets out the core data protection principles, including purpose limitation, data minimisation, accuracy, retention limitation, integrity, confidentiality, and accountability.
  
  
• Financial institutions must comply with both the EU Travel Rule and the GDPR, which govern data collection, data sharing, and data protection.
  
  
• Due to its on-premises design, 21 Analytics’ Travel Rule solution ensures financial institutions GDPR compliance while keeping sensitive customer data securely under CASP control.

The EU’s General Data Protection Regulation (Regulation (EU) 2016/679) establishes a framework focused on the protection of personal data and the privacy rights of individuals across the EU. For institutions handling sensitive data in any format: collection, storage, and so forth, the GDPR is a legal obligation. 

This article summarises the main GDPR principles and explains how 21 Analytics’ Travel Rule solution aids financial institutions in GDPR compliance.

Key Objectives of Data Protection per the GDPR Explained  

The GDPR is built around a set of key principles that govern all personal data processing activities. In short, all organisations must have a valid legal basis for processing personal data and must be transparent about their data usage intentions. [Article 5(1)(a)]. 

GDPR Article 5(1)(b): Purpose Limitation 

Article 5(1)(b) states that personal data can only be “collected for specified, explicit and legitimate purposes and not further processed in a manner that is incompatible with those purposes; further processing for archiving purposes in the public interest, scientific or historical research purposes or statistical purposes shall, in accordance with Article 89(1), not be considered to be incompatible with the initial purposes (‘purpose limitation’)”.

This means personal data can only be collected for specific, legitimate purposes and not used inconsistently with those purposes. 

GDPR Article 5(1)(c): Data Minimisation 

Under Article 5(1)(c), only the minimum data necessary for the stated purpose should be collected and processed: “adequate, relevant and limited to what is necessary in relation to the purposes for which they are processed (‘data minimisation’)”.

GDPR Article 5(1)(d): Accuracy 

Moreover, personal data must be kept current and, if outdated or incorrect, promptly rectified or deleted. 

Per Article 5(1)(d), “accurate and, where necessary, kept up to date; every reasonable step must be taken to ensure that personal data that are inaccurate, having regard to the purposes for which they are processed, are erased or rectified without delay (‘accuracy’)”

GDPR Article 5(1)(e): Retention Limitation 

Article 5(1)(e) clarifies that data must be kept in a form which permits identification of data subjects for no longer than is necessary for the purposes for which the personal data are processed; personal data may be stored for longer periods insofar as the personal data will be processed solely for archiving purposes in the public interest, scientific or historical research purposes or statistical purposes in accordance with Article 89(1) subject to implementation of the appropriate technical and organisational measures required by this Regulation in order to safeguard the rights and freedoms of the data subject (‘storage limitation’).

This means the entity holding the data must ensure it is kept only as long as needed and then properly destroyed.

GDPR Article 5(1)(f): Integrity and Confidentiality 

Under Article 5(1)(f), data controllers* are required to safeguard the integrity and confidentiality of personal data through suitable technical and organisational measures.

Personal data is to be “processed in a manner that ensures appropriate security of the personal data, including protection against unauthorised or unlawful processing and against accidental loss, destruction or damage, using appropriate technical or organisational measures (‘integrity and confidentiality’)”.

*A data controller is the person (or business) who determines the purposes for which, and the way in which, personal data is processed. [Article 5(2)]

Accountability 

Organisations need to demonstrate their ability to comply with the GDPR. This proof is demonstrated through documented processes, controls and governance. 

Guaranteed GDPR Compliance with 21 Analytics

21 Analytics’ Travel Rule solution enables financial institutions to easily and securely comply with both the EU Travel Rule and GDPR. 

Its on-premises design keeps all transacted data within the crypto asset service provider’s (CASP) infrastructure, enabling full data sovereignty and control, and mitigating all third-party risk to the CASP's GDPR policies and controls.

By limiting data sharing to strictly necessary and eliminating intermediary access, the solution prevents reuse or further processing beyond what is legally required and helps financial institutions avoid excessive or unnecessary data processing.

The solution also ensures that data is always exchanged securely and directly with pre-vetted counterparties using peer-to-peer options such as TRUST or TRP. 

This approach significantly reduces the risk of unauthorised access. Moreover, it enables organisations to define and enforce data-retention policies aligned with regulatory and data-protection obligations. This ensures that personal data is retained only for as long as necessary and deleted once its purpose has been fulfilled.

Furthermore, 21 Analytics supports the GDPR accountability principle with clear documentation, technical controls, and governance. Its audit logs and reporting make demonstrating GDPR compliance during audits or reviews straightforward, minimising the compliance workload.

In Conclusion 

CASPs face the challenge of complying with the Travel Rule, which involves the collection and exchange of personal information between counterparties, while the GDPR imposes strict data obligations on how data is to be processed and protected. 

Accordingly, CASPs must implement solutions that fully satisfy both the Travel Rule and GDPR requirements.

21 Analytics enables direct, peer-to-peer Travel Rule data exchanges that align with GDPR. By streamlining compliance and prioritising privacy protection, CASPs can meet regulatory requirements while safeguarding sensitive data and building customer trust.

Find out how 21 Analytics can help you be 100% compliant with the GDPR.