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Counterparty Book and whitelisting

About

Hex Trust helps clients comply with Travel Rule regulations, particularly in Singapore and the MENA region. These regulations require VASPs to collect and verify sender and recipient information for transactions exceeding defined thresholds, and to ensure secure information sharing with compliant counterparties.

Try it: interactive walkthrough

Click the highlighted area on each screen to move through the steps. All names, balances and addresses are demo data.

The Counterparty Book feature enables clients to:

  • Associate blockchain addresses with counterparties (individuals or companies)
  • Link counterparties to their respective VASPs or indicate self-operation as VASPs
  • Provide supplementary information about counterparties and transactions for enhanced transparency and due diligence

For transactions above regulatory thresholds, clients must declare:

  1. Counterparty details, including associated VASPs
  2. Supplementary transfer information
  3. Transaction type (technological or financial)

Counterparty Creation and Management

A Counterparty is a person or entity a wallet may transact with. The Counterparty Book serves as both a Travel Rule compliance tool and a resource for managing entities within the Hex Trust ecosystem.

View and Create: - Access via Settings → Counterparty Book - Click "Create Counterparty" and enter Full Name (Individual) or Legal Name (Company) - Add optional Additional Counterparty Information for compliance purposes

Add Addresses: - Multiple addresses can be added in one request - Required fields: Address, Network, Address Label - Optional fields: Wallet Source, Memo - Wallet Source options: VASPs/CASPs or Self-Hosted (self-hosted addresses require verification) - Address additions or updates require Admin approval

Deposit Flow

Non-intermediary institutions: - Own Profile is the default beneficiary - Hex Trust is the default VASP beneficiary

Intermediary institutions: - Hex Trust is the default VASP beneficiary

Matching Counterparty Detected: If the incoming deposit address matches an existing counterparty entry (name, address, and required info), no declaration is required.

No Matching Counterparty: The deposit is flagged as "Pending Originator/Beneficiary Declaration Information." Required information varies by address type.

Declaration Step: VASP

If a counterparty and address aren't saved in the Counterparty Book, enterprises must save:

Originator Information: - VASP selection - Individual OR Company Information - Additional Information Requirements - Option to save counterparty on-the-fly (triggers approval)

Beneficiary Information: - VASP selection - Individual OR Company Information

Declaration Step: Self-Hosted Verification

Note: Self-hosted sections apply only to HT Singapore custodian entity.

For unverified self-hosted addresses, declare:

Originator Information: - Individual Full Name OR Company Legal Name - Additional Information Requirements - Option to save counterparty on-the-fly (triggers approval)

Beneficiary Information: - Individual Full Name OR Company Legal Name

Verification Process: - System creates new counterparty and adds self-hosted address - Address addition requires 2FA confirmation by Initiator role and Admin approval - Transaction moves to "Pending Wallet Verification" - Send small transfer (native asset or stablecoin) within 24 hours - Platform confirms balance and verifies funds via chain explorer - Address marked as verified once confirmed

Withdrawal Flow

Non-intermediary institutions: - Own Profile is the default originator - Hex Trust is the default VASP originator

Intermediary institutions: - Hex Trust is the default VASP originator

Users can save beneficiary counterparties from the Counterparty Book during withdrawal. Addresses can be selected from Internal Vaults or the Counterparty Book.

Declaration Step: VASP

If address doesn't appear in Internal Vaults or Counterparty Book:

Beneficiary Information: - Beneficiary VASP - Counterparty: Individual OR Company - Additional Information Requirements - Option to save as counterparty and address (triggers separate approval plus withdrawal approval)

Declaration Step: Self-Hosted Verification

Users must add and verify self-hosted wallet addresses through the Counterparty Book prior to withdrawal.

Verification for EVM, Solana, Bitcoin & Other Addresses: Users verify addresses by following platform instructions. Once the additional transfer is sent, the self-hosted address is marked verified.

Counterparty Whitelisting

Whitelisting limits a vault's withdrawals to the addresses of counterparties you choose. It reduces the risk of fraud, misrouting and unauthorised withdrawals.

Admins and Initiators manage whitelists, and Admin Approvers approve them. See User roles.

  1. Open the menu under your name, click Settings, and open the Whitelisting tab.
  2. Decide how to enforce it:
  3. Enforce Whitelisting on all Vaults blocks withdrawals from any vault that has no whitelist.
  4. Leave it off to whitelist vault by vault.
  5. On the vault's row, click Add Whitelist.
  6. Open the Counterparty list and tick each counterparty the vault may send to. All of their saved addresses become allowed destinations.
  7. Click Continue and confirm. Admin Approvers then approve the whitelist in the Hex Safe Mobile App.

To remove a vault's whitelist, click Remove Vault Whitelist on its row.