Global reporting rules are increasing adoption of standardised token identification
04 Mar 2026
Tahlia Kraefft assesses how the acceleration of global regulatory frameworks for digital assets, particularly the EU’s Markets in Crypto-Assets Regulation and the OECD’s Crypto-Asset Reporting Framework, is driving adoption of Digital Token Identifiers as the standard for identifying crypto-assets
Image: cinfiniteflow/stock.adobe.com
Global tax transparency laws and anti-money laundering (AML) obligations are steering the implementation of standardised identification systems, as regulators and financial institutions pursue a standardised means of classifying and reporting crypto assets across borders. Digital Token Identifiers (DTI) adoption provides the underlying structure to facilitate viable cross-border tax reporting, automated AML and Travel Rule compliance, secure institutional participation, and scalable Markets in Crypto-Assets Regulation (MiCA)-style oversight. Due to reporting risk produced by inconsistent classification and fragmented token naming conventions regulators are indirectly requiring standardisation.
MiCA data demands
In July 2024, the European Securities and Markets Authority (ESMA) mandated the use of the ISO 24165 under MiCA regulation to enhance market integrity and standardisation. A key pillar of MiCA is the clear categorisation of crypto-assets divided into asset-referenced tokens (ARTs), electronic money tokens (EMTs), and utility tokens groups with distinct regulations applied to them. Under the regulation crypto-asset service providers (CASPs) must provide detailed reports to national competent authorities regarding transaction volumes, client asset custody, as well as significant holdings if relevant. For supervisory authorities, who demand consistent identification of tokens across platforms, DTIs help decrease ambiguity in reporting.
Rowan Varrall, regulatory affairs director at Digital Token Identifier Foundation, states that under MiCA the DTI is a core cryptoasset identifier, “introducing structured disclosure, transparency, record-keeping, order book, and supervisory reporting obligations across the EU, MiCA required a means to uniquely and unambiguously identify crypto-assets.”
He remarks its use across order book records, record-keeping, trade transparency, and disclosure documentation is key for “supporting MiCA’s market integrity and investor protection objectives, a standardised digital token identifier ensures clarity, consistency, and the potential to deliver data-driven supervision across crypto-asset trading activities”.
Varrall explains there are the two core users taking up DTI as means of standardising cryptoasset identification and to align with MiCA obligations are white paper creators and CASP: “White paper creators add DTI codes to represent exactly which cryptoassets are being offered to the public. This may be a stablecoin, EMT, or ART or another unbacked cryptoasset. As one of the key objectives of white papers is to provide a standardised disclosure document for potential investors, the DTI provides a standardised language for the exact cryptoasset offered.
“CASPs leverage DTI codes as part of their operational and regulatory compliance data requirements. Instead of reporting a transaction related to Ethereum, ETH, Ether, or another platform ticker code or name, a trading platform can leverage the DTI code ‘X9J9K872S’ that represents the technical protocol token on the Ethereum blockchain.”
Chris Ostrowski, head of product management, FinScan, reasons that the significantly increased structured, machine-readable asset data obligations from anti-money laundering (AML), travel rule, and disclosure requirements under MiCA are leading participants to take up standardised token identifiers.
“First, as MiCA was imposed, it drove a uniform transparency and disclosure obligations that require consistent token classification. Because of these EU-wide rules, it pushes those token issuers, regardless of what type of token they are — EMTs, ARTs, etc. — towards a standard token definition. Without those standards, there would be inconsistent or proprietary labeling gaps which would significantly complicate compliance and supervisory reporting.
“Second, AML and Travel Rule requirements increase pressure for consistent identifiers linked to verified asset data. With the EU Travel Rule requiring personal information to accompany every transfer, it falls on the CASPs to detect if there are deficiencies in the transaction and suspend it while it is evaluated. Because of this, systems must map to a known, verifiable reference —something that is not possible without a standard asset identifier.
“Third, supervised reporting under MiCA and AMLA demands interoperable, regulator?readable token data structures. The creation of ESMA’s central MiCA register and standardised white paper requirements obligate issuers to provide structured asset information that regulators can ingest and compare across the EU. Consistent identifiers make compliance feasible at scale as authorities monitor transactions, assess risks, and enforce uniform rules across 27 member states.
“Finally, operational realities of enhanced transaction monitoring under MiCA push CASPs toward standardised token taxonomies. MiCA mandates stricter transaction monitoring and enhanced due diligence, requiring CASPs to identify and assess risks associated with specific assets. Without standard identifiers, AML systems cannot reliably apply risk rules, cross?jurisdictional analytics, or sanctions/blacklist checks — as highlighted by MiCA’s emphasis on robust monitoring frameworks.”
Ari Redbord, vice-president, global head of policy and government affairs at TRM Labs, says as MiCA moves into full implementation and other jurisdictions increase reporting, disclosure, and prudential requirements, market participants are under greater pressure to precisely identify the assets they custody, trade, settle, or provide services for. He continues: “That includes consistent token identifiers, clear mappings between smart contracts and issuers, and reliable metadata that can support supervisory reporting, risk classification, and transaction monitoring.”
MiCA in particular is accelerating this shift, according to Redbord. The regulation requires granular transparency around token type, issuer status, white paper disclosures, reserve structures for asset-referenced tokens and e-money tokens, and ongoing reporting obligations. He believes that firms operating in or servicing the EU need to know not only what token they are interacting with, but how that token is classified under MiCA and whether it falls within specific regulatory categories. “That creates demand for standardised token identification frameworks that go beyond ticker symbols and address-level data to incorporate regulatory attributes and risk typologies,” he adds.
Jean-Baptiste Graftieaux, country director for Luxembourg, Coinbase, notes: “Although MiCA does not prescribe a single EU-level identifier, its harmonised framework — alongside guidance from the ESMA — is bringing the market into closer alignment around ISO 24165 Digital Token Identifiers. In practice, this means token identification is moving from being a matter of industry preference to something supervisors expect firms to apply consistently.”
In his analysis, Graftieaux notes how MiCA is raising expectations by introducing a single rulebook across the EU covering disclosures, governance, market abuse monitoring, and stablecoin oversight. Firms are now expected to maintain clearer, more structured records and stronger internal controls than under the previous patchwork of national regimes.
“As a result, crypto asset data is being treated more like traditional financial instrument data — classified, traceable and defensible — much closer to those applied to traditional financial institutions. That strengthens consumer protection, supports institutional confidence, and helps integrate crypto into mainstream financial infrastructure across the EU,” adds Graftieaux.
Convergence of global reporting regimes
The confluence of global tax reporting regimes, including the implementation of the OECD’s Crypto-Asset Reporting Framework (CARF) and the updated Common Reporting Standard (CRS 2.0) is increasing the adoption of DTIs.
As tax regulators set out to close reporting gaps between traditional finance and crypto-assets, global tax reporting regimes are necessitating that crypto-assets are tracked with the same level of detail as traditional securities which use ISINs.
The CARF framework, enforced by over 75 jurisdictions (including 27 EU Member States through Directive on Administrative Cooperation), requires CASPs to disclose transaction-level data, along with the type of crypto-asset, exchange rates, and transaction amounts. The DTI facilitates this comprehensive reporting.
The updated CRS 2.0, extends the definition of reportable financial accounts, to include e-money, central bank digital currencies, and specific crypto-assets bringing standardised reporting requirements across over 120 jurisdictions. Financial institutions are employing DTI as a standard for identifying digital assets as they seek to manage high-volume complex reporting and avoid fines.
Tax authorities are requiring harmonious asset identification to monitor assets across exchanges, circumvent duplicate reporting, and misclassification DTI enables individual global ID per token, standardised metadata, and interoperability with current ISIN-style frameworks.
Varrall of DTIF remarks: “The OECD’s CARF establishes a baseline set of data elements that must be collected and exchanged for crypto-asset transactions. This includes identifying the crypto-asset, the parties involved, and the nature and value of the transaction. Effective implementation across jurisdictions depends on those data points being structured, comparable, and unambiguous.
“If CARF is implemented consistently, it provides a clear global reference model for minimum reporting standards. That, in turn, creates strong incentives for market participants to align their systems with harmonised token identifiers and standardised data fields. Without a common way to identify crypto-assets across platforms and borders, reporting becomes fragmented, reconciliation becomes costly, and supervisory effectiveness is reduced.”
Although there may not be formal coordination between regulators, there is a universal push towards a need for standardisation. Graftieaux from Coinbase notes that there is a “clear move” in the same direction, even if implementation timelines vary. Across major jurisdictions, he is seeing a shared focus on tax reporting, Travel Rule requirements, and more structured operational data.
The EU has MiCA and DAC8, the UK is progressing toward CARF-aligned reporting, the US has introduced broker reporting requirements, and key markets in Asia are moving along similar lines, Graftieaux explains. Overall, he understands that the trajectory is toward greater transparency and fewer blind spots. And the closer these frameworks align on interoperable standards, the lower the fragmentation risk and the more efficiently global firms can operate, while maintaining strong consumer protection and regulatory oversight, he highlights.
Graftieaux continues: “Global reporting only works at scale if asset identification is consistent across jurisdictions and systems. Frameworks like the OECD’s CARF are a real catalyst here. When tax authorities automatically exchange information about crypto holdings across borders, they need reliable and standardised asset references. DAC8 embeds that approach into European law. As cross-border onchain activity grows — particularly through stablecoins — tax transparency frameworks depend on consistent, structured data.”
Becki La Porte, principal of AML strategy and innovation at FinScan, disagrees there is convergence between the four regions but says there may be some overlap organically: “The US is often an outlier in any kind of regulation. This is typically due to requirements of underlying regulation that is unique to the US. You are likely to see a greater overlap between the EU and UK as many of their underlying regulations are similar.
“Culture often fuels the development of regulations. What may be common practice in one region could be unheard of in another. Even within a region, you will see diverse cultures that inform how regulations are written.”
La Porte highlights the Asian market as a prime example of those cultural differences that will determine the level and type of regulatory requirements. For example, she says Singapore has a unique culture and often has strong controls around reporting and financial crime controls. Compare this to Philippines and Vietnam, which are very different from Singapore culturally in many ways, and are currently on the Financial Action Task Force grey list due to lax controls.
Varrall says that while there is difference between the regions’ reporting data expectations there are parallels on what they seek to achieve. “Key jurisdictions are working their way through how to consider crypto reporting expectations, each with their own set of priorities and timelines. In the EU, MiCA sets a broad supervisory and disclosure framework.
“The UK is advancing its own phased crypto regulatory regime. In the US and across parts of Asia, authorities are strengthening transaction reporting, custody standards, and tax information exchange frameworks. Key themes on what all jurisdictions are converging on are the desire for enhanced transparency, market integrity safeguards, and efforts toward international harmonisation.”
AML and The Travel Rule requirements
As of September 2025, authorities in the US, EU, UK, and APAC impose versions of the Travel Rule. Under the Travel Rule, Virtual Asset Service Providers (VASPs) and financial institutions are obliged to securely transmit, receive, and hold specific sender and recipient information during virtual asset transfers. Without implementing token identifiers, messaging systems experience difficulty in reconciling asset types, there is increased compliance friction and risk of incongruous reporting. The use of DTIs assist link token codes in compliance messaging, diminish false positives in AML systems, and enhance blockchain analytics interoperability.
Graftieaux notes that AML and travel rule requirements expose weaknesses in inconsistent data classification rapidly. “AML obligations, including transaction monitoring and sanctions screening, rely on firms being able to clearly identify what asset is moving through the system. The Travel Rule adds another layer, requiring accurate information about the asset transferred and the parties involved to be shared between regulated entities.”
He continues: “When the same economic exposure can appear under multiple tickers, contract addresses or wrapped formats, it can create confusion in monitoring and reporting. That makes it harder for institutions to stay aligned across borders. As cross-border onchain activity grows, expectations around precision naturally increase, which is driving greater demand for structured, standardised token identifiers to support compliance at scale.”
Ostrowski states that AML and Travel Rule requirements depend on accurate, standardised information about the asset’s transfer and involved parties, so key weaknesses in out of step token classification are obvious.
He explores: “Under the EU’s Travel Rule, CASPs must collect and transmit complete originator and beneficiary data for every transaction — due to the EU’s zero-threshold requirement — which creates a heavy data-validation burden and exposes the operational risk of having tokens labelled or interpreted differently across platforms.
“When token classifications lack structure and consistency, firms struggle to align transaction data with required AML checks, increasing the likelihood of missing or incomplete information that triggers transaction reviews or regulatory scrutiny.
“Together, these AML and MiCA-driven expectations are accelerating the industry’s shift to a more structured, interoperable token identifiers, since only standardised asset data enables CASPs to satisfy both regulatory reporting and real-time Travel Rule compliance without introducing friction or compliance risk. These are very similar to the ISO20022 standards in other payment forms. The structured token identifiers allow for consistent mapping of the fields into a predictable format, helping to support better throughput of the data.”
Global AML and travel rule requirements are lifting the bar on data quality and interoperability, according to Redbord. He explains: “Travel rule compliance depends on consistent counterparty identification and accurate asset attribution across virtual asset service providers. Inconsistent token naming conventions, forks, wrapped assets, and cross-chain deployments create friction unless there is a common identification layer that supports interoperability between compliance systems.
“As regulators expect firms to demonstrate effective sanctions screening, transaction monitoring, and suspicious activity reporting in crypto markets, standardised token identifiers become foundational infrastructure rather than a nice-to-have.”
La Porte notes that there are always people trying to find a way around new rules: “The challenges are the nuances and diversity of digital currency. They can potentially create a method of transfer that is right on the edge of a Virtual Asset Service Provider and argue the underlying data is not required.
“As with all things related to crime, the criminals will find the path of least resistance. They will send digital assets to jurisdictions with loose or limited controls so that the underlying data is either removed or lost. They may even alter data before sending it to a more compliant jurisdiction. It would take a complicit network of organised criminals to make this happen, but this is not uncommon in financial crime circles. Structured token identifiers may make it more difficult, but it’s nearly impossible to 100 per cent solve for bad actors.”
Risks of inconsistent identification frameworks
Standardised token identification is integral to overcoming reporting fragmentation across disparate systems, along with increasing efficiency. Without consistent token IDs there are reporting risks of discrepant submissions, the potential for incongruous classifications under the CARF framework, along with higher error rates, and enforcement exposure. Cross-border exchanges also face the potential of multiple mailing systems for the same token. Additionally If identifiers differ it complicates the process of automated data exchange between jurisdictions (through the Organisation for Co-operation and Development framework).
Varrall explains fragmentation is status quo where globally standardised identifiers such as DTIs are not applied. “Over time, jurisdictions that diverge from emerging international identification practices risk isolating their domestic operators from the wider digital asset ecosystem.
“Global financial markets have consistently shown that harmonised identifiers are foundational to cross-border scalability and supervisory cooperation. As crypto markets mature, convergence around common token identification standards is increasingly becoming market practice — not just a regulatory preference — enabling interoperability, reducing friction, and strengthening international integration.”
La Porte notes a lack of consistency in identification frameworks between jurisdictions can lead to issues such as an inability to properly transfer funds due to lost and irreconcilable data. “Missing and inconsistent data can create issues with the ability to properly transfer funds. Jurisdiction A might require far less information than Jurisdiction B. It’s not a problem when it stays in Jurisdiction A, but it could violate a regulation in Jurisdiction B.
“Even though it may appear more streamlined or efficient to request the least amount of identification data as possible, it also can open the door to those with nefarious intentions. The less data provided makes it harder to follow the money trail should the funds become part of a criminal investigation. It can also make it difficult to rule out a sanctions or watchlist hit if the originating jurisdiction doesn’t require robust enough identification information.”
Fragmentation has the potential to drive higher compliance costs, increase regulatory exploitation and hinder institution participation. Graftieaux says fragmentation can also increase risk. He explores: “Firms operating across borders would need to build translation layers between regimes, which can introduce reconciliation challenges and reporting inconsistencies.
Over time, that slows cross-border activity and reduces operational efficiency.
Graftieaux continues: “Digital assets are inherently global, and inconsistent standards can undermine the seamless interoperability that onchain systems are designed to deliver. There is a clear opportunity for regulators to work toward a truly global, interconnected financial system that supports transparency, efficiency and effective supervision across borders.
Digital asset markets are maturing into a more institutionally integrated environment as a broader trend according to Redbord.
“With that maturity comes supervisory expectations that resemble — and in some ways exceed — those in traditional finance. Data lineage, asset traceability, issuer transparency, and risk classification are all becoming core operational requirements. Standardised token identification systems help firms meet these obligations more efficiently, reduce reconciliation errors, and support cross-border regulatory alignment.
“From our perspective, the firms that treat token identification and data normalisation as strategic investments rather than compliance afterthoughts will be best positioned as regulatory frameworks continue to converge globally.”
Regulation driving infrastructure maturity
As crypto-asset markets evolve from minimal oversight to regulated financial infrastructure, the implementation of unique, machine-readable asset identifiers, interoperable data standards, and harmonious classification frameworks are becoming key for ensuring market integrity and enabling institutional adoption.
Although not universally mandated, DTI standardisation is increasingly becoming a condition for participation in regulated digital asset markets. The implementation of identification systems that facilitate global oversight and enhanced transparency have the potential to play a larger role in shaping the next stage of crypto, than technological experimentation.
MiCA data demands
In July 2024, the European Securities and Markets Authority (ESMA) mandated the use of the ISO 24165 under MiCA regulation to enhance market integrity and standardisation. A key pillar of MiCA is the clear categorisation of crypto-assets divided into asset-referenced tokens (ARTs), electronic money tokens (EMTs), and utility tokens groups with distinct regulations applied to them. Under the regulation crypto-asset service providers (CASPs) must provide detailed reports to national competent authorities regarding transaction volumes, client asset custody, as well as significant holdings if relevant. For supervisory authorities, who demand consistent identification of tokens across platforms, DTIs help decrease ambiguity in reporting.
Rowan Varrall, regulatory affairs director at Digital Token Identifier Foundation, states that under MiCA the DTI is a core cryptoasset identifier, “introducing structured disclosure, transparency, record-keeping, order book, and supervisory reporting obligations across the EU, MiCA required a means to uniquely and unambiguously identify crypto-assets.”
He remarks its use across order book records, record-keeping, trade transparency, and disclosure documentation is key for “supporting MiCA’s market integrity and investor protection objectives, a standardised digital token identifier ensures clarity, consistency, and the potential to deliver data-driven supervision across crypto-asset trading activities”.
Varrall explains there are the two core users taking up DTI as means of standardising cryptoasset identification and to align with MiCA obligations are white paper creators and CASP: “White paper creators add DTI codes to represent exactly which cryptoassets are being offered to the public. This may be a stablecoin, EMT, or ART or another unbacked cryptoasset. As one of the key objectives of white papers is to provide a standardised disclosure document for potential investors, the DTI provides a standardised language for the exact cryptoasset offered.
“CASPs leverage DTI codes as part of their operational and regulatory compliance data requirements. Instead of reporting a transaction related to Ethereum, ETH, Ether, or another platform ticker code or name, a trading platform can leverage the DTI code ‘X9J9K872S’ that represents the technical protocol token on the Ethereum blockchain.”
Chris Ostrowski, head of product management, FinScan, reasons that the significantly increased structured, machine-readable asset data obligations from anti-money laundering (AML), travel rule, and disclosure requirements under MiCA are leading participants to take up standardised token identifiers.
“First, as MiCA was imposed, it drove a uniform transparency and disclosure obligations that require consistent token classification. Because of these EU-wide rules, it pushes those token issuers, regardless of what type of token they are — EMTs, ARTs, etc. — towards a standard token definition. Without those standards, there would be inconsistent or proprietary labeling gaps which would significantly complicate compliance and supervisory reporting.
“Second, AML and Travel Rule requirements increase pressure for consistent identifiers linked to verified asset data. With the EU Travel Rule requiring personal information to accompany every transfer, it falls on the CASPs to detect if there are deficiencies in the transaction and suspend it while it is evaluated. Because of this, systems must map to a known, verifiable reference —something that is not possible without a standard asset identifier.
“Third, supervised reporting under MiCA and AMLA demands interoperable, regulator?readable token data structures. The creation of ESMA’s central MiCA register and standardised white paper requirements obligate issuers to provide structured asset information that regulators can ingest and compare across the EU. Consistent identifiers make compliance feasible at scale as authorities monitor transactions, assess risks, and enforce uniform rules across 27 member states.
“Finally, operational realities of enhanced transaction monitoring under MiCA push CASPs toward standardised token taxonomies. MiCA mandates stricter transaction monitoring and enhanced due diligence, requiring CASPs to identify and assess risks associated with specific assets. Without standard identifiers, AML systems cannot reliably apply risk rules, cross?jurisdictional analytics, or sanctions/blacklist checks — as highlighted by MiCA’s emphasis on robust monitoring frameworks.”
Ari Redbord, vice-president, global head of policy and government affairs at TRM Labs, says as MiCA moves into full implementation and other jurisdictions increase reporting, disclosure, and prudential requirements, market participants are under greater pressure to precisely identify the assets they custody, trade, settle, or provide services for. He continues: “That includes consistent token identifiers, clear mappings between smart contracts and issuers, and reliable metadata that can support supervisory reporting, risk classification, and transaction monitoring.”
MiCA in particular is accelerating this shift, according to Redbord. The regulation requires granular transparency around token type, issuer status, white paper disclosures, reserve structures for asset-referenced tokens and e-money tokens, and ongoing reporting obligations. He believes that firms operating in or servicing the EU need to know not only what token they are interacting with, but how that token is classified under MiCA and whether it falls within specific regulatory categories. “That creates demand for standardised token identification frameworks that go beyond ticker symbols and address-level data to incorporate regulatory attributes and risk typologies,” he adds.
Jean-Baptiste Graftieaux, country director for Luxembourg, Coinbase, notes: “Although MiCA does not prescribe a single EU-level identifier, its harmonised framework — alongside guidance from the ESMA — is bringing the market into closer alignment around ISO 24165 Digital Token Identifiers. In practice, this means token identification is moving from being a matter of industry preference to something supervisors expect firms to apply consistently.”
In his analysis, Graftieaux notes how MiCA is raising expectations by introducing a single rulebook across the EU covering disclosures, governance, market abuse monitoring, and stablecoin oversight. Firms are now expected to maintain clearer, more structured records and stronger internal controls than under the previous patchwork of national regimes.
“As a result, crypto asset data is being treated more like traditional financial instrument data — classified, traceable and defensible — much closer to those applied to traditional financial institutions. That strengthens consumer protection, supports institutional confidence, and helps integrate crypto into mainstream financial infrastructure across the EU,” adds Graftieaux.
Convergence of global reporting regimes
The confluence of global tax reporting regimes, including the implementation of the OECD’s Crypto-Asset Reporting Framework (CARF) and the updated Common Reporting Standard (CRS 2.0) is increasing the adoption of DTIs.
As tax regulators set out to close reporting gaps between traditional finance and crypto-assets, global tax reporting regimes are necessitating that crypto-assets are tracked with the same level of detail as traditional securities which use ISINs.
The CARF framework, enforced by over 75 jurisdictions (including 27 EU Member States through Directive on Administrative Cooperation), requires CASPs to disclose transaction-level data, along with the type of crypto-asset, exchange rates, and transaction amounts. The DTI facilitates this comprehensive reporting.
The updated CRS 2.0, extends the definition of reportable financial accounts, to include e-money, central bank digital currencies, and specific crypto-assets bringing standardised reporting requirements across over 120 jurisdictions. Financial institutions are employing DTI as a standard for identifying digital assets as they seek to manage high-volume complex reporting and avoid fines.
Tax authorities are requiring harmonious asset identification to monitor assets across exchanges, circumvent duplicate reporting, and misclassification DTI enables individual global ID per token, standardised metadata, and interoperability with current ISIN-style frameworks.
Varrall of DTIF remarks: “The OECD’s CARF establishes a baseline set of data elements that must be collected and exchanged for crypto-asset transactions. This includes identifying the crypto-asset, the parties involved, and the nature and value of the transaction. Effective implementation across jurisdictions depends on those data points being structured, comparable, and unambiguous.
“If CARF is implemented consistently, it provides a clear global reference model for minimum reporting standards. That, in turn, creates strong incentives for market participants to align their systems with harmonised token identifiers and standardised data fields. Without a common way to identify crypto-assets across platforms and borders, reporting becomes fragmented, reconciliation becomes costly, and supervisory effectiveness is reduced.”
Although there may not be formal coordination between regulators, there is a universal push towards a need for standardisation. Graftieaux from Coinbase notes that there is a “clear move” in the same direction, even if implementation timelines vary. Across major jurisdictions, he is seeing a shared focus on tax reporting, Travel Rule requirements, and more structured operational data.
The EU has MiCA and DAC8, the UK is progressing toward CARF-aligned reporting, the US has introduced broker reporting requirements, and key markets in Asia are moving along similar lines, Graftieaux explains. Overall, he understands that the trajectory is toward greater transparency and fewer blind spots. And the closer these frameworks align on interoperable standards, the lower the fragmentation risk and the more efficiently global firms can operate, while maintaining strong consumer protection and regulatory oversight, he highlights.
Graftieaux continues: “Global reporting only works at scale if asset identification is consistent across jurisdictions and systems. Frameworks like the OECD’s CARF are a real catalyst here. When tax authorities automatically exchange information about crypto holdings across borders, they need reliable and standardised asset references. DAC8 embeds that approach into European law. As cross-border onchain activity grows — particularly through stablecoins — tax transparency frameworks depend on consistent, structured data.”
Becki La Porte, principal of AML strategy and innovation at FinScan, disagrees there is convergence between the four regions but says there may be some overlap organically: “The US is often an outlier in any kind of regulation. This is typically due to requirements of underlying regulation that is unique to the US. You are likely to see a greater overlap between the EU and UK as many of their underlying regulations are similar.
“Culture often fuels the development of regulations. What may be common practice in one region could be unheard of in another. Even within a region, you will see diverse cultures that inform how regulations are written.”
La Porte highlights the Asian market as a prime example of those cultural differences that will determine the level and type of regulatory requirements. For example, she says Singapore has a unique culture and often has strong controls around reporting and financial crime controls. Compare this to Philippines and Vietnam, which are very different from Singapore culturally in many ways, and are currently on the Financial Action Task Force grey list due to lax controls.
Varrall says that while there is difference between the regions’ reporting data expectations there are parallels on what they seek to achieve. “Key jurisdictions are working their way through how to consider crypto reporting expectations, each with their own set of priorities and timelines. In the EU, MiCA sets a broad supervisory and disclosure framework.
“The UK is advancing its own phased crypto regulatory regime. In the US and across parts of Asia, authorities are strengthening transaction reporting, custody standards, and tax information exchange frameworks. Key themes on what all jurisdictions are converging on are the desire for enhanced transparency, market integrity safeguards, and efforts toward international harmonisation.”
AML and The Travel Rule requirements
As of September 2025, authorities in the US, EU, UK, and APAC impose versions of the Travel Rule. Under the Travel Rule, Virtual Asset Service Providers (VASPs) and financial institutions are obliged to securely transmit, receive, and hold specific sender and recipient information during virtual asset transfers. Without implementing token identifiers, messaging systems experience difficulty in reconciling asset types, there is increased compliance friction and risk of incongruous reporting. The use of DTIs assist link token codes in compliance messaging, diminish false positives in AML systems, and enhance blockchain analytics interoperability.
Graftieaux notes that AML and travel rule requirements expose weaknesses in inconsistent data classification rapidly. “AML obligations, including transaction monitoring and sanctions screening, rely on firms being able to clearly identify what asset is moving through the system. The Travel Rule adds another layer, requiring accurate information about the asset transferred and the parties involved to be shared between regulated entities.”
He continues: “When the same economic exposure can appear under multiple tickers, contract addresses or wrapped formats, it can create confusion in monitoring and reporting. That makes it harder for institutions to stay aligned across borders. As cross-border onchain activity grows, expectations around precision naturally increase, which is driving greater demand for structured, standardised token identifiers to support compliance at scale.”
Ostrowski states that AML and Travel Rule requirements depend on accurate, standardised information about the asset’s transfer and involved parties, so key weaknesses in out of step token classification are obvious.
He explores: “Under the EU’s Travel Rule, CASPs must collect and transmit complete originator and beneficiary data for every transaction — due to the EU’s zero-threshold requirement — which creates a heavy data-validation burden and exposes the operational risk of having tokens labelled or interpreted differently across platforms.
“When token classifications lack structure and consistency, firms struggle to align transaction data with required AML checks, increasing the likelihood of missing or incomplete information that triggers transaction reviews or regulatory scrutiny.
“Together, these AML and MiCA-driven expectations are accelerating the industry’s shift to a more structured, interoperable token identifiers, since only standardised asset data enables CASPs to satisfy both regulatory reporting and real-time Travel Rule compliance without introducing friction or compliance risk. These are very similar to the ISO20022 standards in other payment forms. The structured token identifiers allow for consistent mapping of the fields into a predictable format, helping to support better throughput of the data.”
Global AML and travel rule requirements are lifting the bar on data quality and interoperability, according to Redbord. He explains: “Travel rule compliance depends on consistent counterparty identification and accurate asset attribution across virtual asset service providers. Inconsistent token naming conventions, forks, wrapped assets, and cross-chain deployments create friction unless there is a common identification layer that supports interoperability between compliance systems.
“As regulators expect firms to demonstrate effective sanctions screening, transaction monitoring, and suspicious activity reporting in crypto markets, standardised token identifiers become foundational infrastructure rather than a nice-to-have.”
La Porte notes that there are always people trying to find a way around new rules: “The challenges are the nuances and diversity of digital currency. They can potentially create a method of transfer that is right on the edge of a Virtual Asset Service Provider and argue the underlying data is not required.
“As with all things related to crime, the criminals will find the path of least resistance. They will send digital assets to jurisdictions with loose or limited controls so that the underlying data is either removed or lost. They may even alter data before sending it to a more compliant jurisdiction. It would take a complicit network of organised criminals to make this happen, but this is not uncommon in financial crime circles. Structured token identifiers may make it more difficult, but it’s nearly impossible to 100 per cent solve for bad actors.”
Risks of inconsistent identification frameworks
Standardised token identification is integral to overcoming reporting fragmentation across disparate systems, along with increasing efficiency. Without consistent token IDs there are reporting risks of discrepant submissions, the potential for incongruous classifications under the CARF framework, along with higher error rates, and enforcement exposure. Cross-border exchanges also face the potential of multiple mailing systems for the same token. Additionally If identifiers differ it complicates the process of automated data exchange between jurisdictions (through the Organisation for Co-operation and Development framework).
Varrall explains fragmentation is status quo where globally standardised identifiers such as DTIs are not applied. “Over time, jurisdictions that diverge from emerging international identification practices risk isolating their domestic operators from the wider digital asset ecosystem.
“Global financial markets have consistently shown that harmonised identifiers are foundational to cross-border scalability and supervisory cooperation. As crypto markets mature, convergence around common token identification standards is increasingly becoming market practice — not just a regulatory preference — enabling interoperability, reducing friction, and strengthening international integration.”
La Porte notes a lack of consistency in identification frameworks between jurisdictions can lead to issues such as an inability to properly transfer funds due to lost and irreconcilable data. “Missing and inconsistent data can create issues with the ability to properly transfer funds. Jurisdiction A might require far less information than Jurisdiction B. It’s not a problem when it stays in Jurisdiction A, but it could violate a regulation in Jurisdiction B.
“Even though it may appear more streamlined or efficient to request the least amount of identification data as possible, it also can open the door to those with nefarious intentions. The less data provided makes it harder to follow the money trail should the funds become part of a criminal investigation. It can also make it difficult to rule out a sanctions or watchlist hit if the originating jurisdiction doesn’t require robust enough identification information.”
Fragmentation has the potential to drive higher compliance costs, increase regulatory exploitation and hinder institution participation. Graftieaux says fragmentation can also increase risk. He explores: “Firms operating across borders would need to build translation layers between regimes, which can introduce reconciliation challenges and reporting inconsistencies.
Over time, that slows cross-border activity and reduces operational efficiency.
Graftieaux continues: “Digital assets are inherently global, and inconsistent standards can undermine the seamless interoperability that onchain systems are designed to deliver. There is a clear opportunity for regulators to work toward a truly global, interconnected financial system that supports transparency, efficiency and effective supervision across borders.
Digital asset markets are maturing into a more institutionally integrated environment as a broader trend according to Redbord.
“With that maturity comes supervisory expectations that resemble — and in some ways exceed — those in traditional finance. Data lineage, asset traceability, issuer transparency, and risk classification are all becoming core operational requirements. Standardised token identification systems help firms meet these obligations more efficiently, reduce reconciliation errors, and support cross-border regulatory alignment.
“From our perspective, the firms that treat token identification and data normalisation as strategic investments rather than compliance afterthoughts will be best positioned as regulatory frameworks continue to converge globally.”
Regulation driving infrastructure maturity
As crypto-asset markets evolve from minimal oversight to regulated financial infrastructure, the implementation of unique, machine-readable asset identifiers, interoperable data standards, and harmonious classification frameworks are becoming key for ensuring market integrity and enabling institutional adoption.
Although not universally mandated, DTI standardisation is increasingly becoming a condition for participation in regulated digital asset markets. The implementation of identification systems that facilitate global oversight and enhanced transparency have the potential to play a larger role in shaping the next stage of crypto, than technological experimentation.
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