Bitfinex Crypto Exchange Adopts Chainalysis KYT to Combat Money Laundering
Major cryptocurrency exchange platform, Bitfiniex, has taken steps to monitor transactions that occur on the platform, by integrating a compliance tool, Chainalysis KYT from Chainalysis, a top blockchain analysis startup. The tool will help the crypto exchange to monitor transactions that occur on the exchange and combat money laundering and illegal activities.
Bitfinex Integration Bespoke Chainalysis AML Tool
According to a press release on PR Newswire Thursday, December 12, Chainalysis recently completed an anti-money laundering compliance solution, known as Chainalysis KYT (Know Your Transaction) in collaboration with the crypto exchange, Bitfinex.
An excerpt from the press release reads:
“By leveraging Chainalysis KYT (Know Your Transaction), cryptocurrency businesses such as Bitfinex can monitor large volumes of cryptocurrency activity and identify high-risk transactions on a continuous basis. Real-time alerting on the riskiest activity coupled with enhanced due diligence allow compliance teams to focus on the most urgent activity, enforce compliance policies, and better allocate resources”.
The analytic company is gradually becoming the NASDAQ of crypto, by bringing institutional-grade trading monitoring tools to the nascent industry. Furthermore, such a partnership between Bitfinex and Chainalysis moves further away from Know-Your-Customer (KYC) to KYT.
Bitfinex is, however, not the only crypto exchange to partner with Chainalysis. Back in October 2018, the blockchain analytic firm also completed the global roll-out of its compliance tool in partnership with major digital currency exchange, Binance.
Commenting on the latest development is Peter Warrack, Chief Compliance Officer at Bitfinex, who said:
“Chainalysis is a top-of-the-line, comprehensive and privacy-safe compliance solution aligned with what we were seeking to keep bad actors off of our platform while protecting the privacy of our users. The solution does not share information identifying users, which is kept strictly in-house. We are excited to work alongside the Chainalysis team to continue to build out a safe and robust platform for our users”.
Currently, Chainalysis tracks 41 virtual currencies such as Litecoin (LTC), Ether (ETH), Bitcoin Cash (BCH), and ERC-20 tokens.
Regulators Push for Safe Crypto Exchange Platforms
Governments and regulatory agencies globally continually stress the need for cryptocurrency exchanges to ensure that their platform is secure from hack and theft. Crypto exchanges have suffered hacking and theft majorly because of their poor security system.
As reported by BTCManager in November 2019, the Hong Kong financial watchdog, the Securities Futures Commission (SFC) announced a new set of regulations for exchanges operating in the country. The new regulations, among other things, would focus on KYC and AML rules.
Back in July 2019, four major virtual currency exchanges reportedly faced increased scrutiny from commercial banks, following FATF guidelines. The banks insisted on stringent AML controls from these exchanges as a condition to offer continued banking services.