Blockchain analytics firm Chainalysis has launched transaction alerts for suspicious exchanges of a range of cryptocurrencies.
In a post published on the firm’s blog on Aug. 22, Chainalysis announced the launch of alerts for suspicious cryptocurrency transactions in Chainalysis Know Your Transaction (KYT), the company’s real-time anti-money laundering compliance solution. The company also claims that this is the first compliance alerts solution available for 15 crypto assets.
Compliance risk mitigation
The tool is meant to help cryptocurrency exchanges and other financial institutions mitigate their regulatory and reputational risks. Michael Breu, chief compliance officer at major crypto exchange Gemini, is quoted in the announcement:
“As a New York Trust company we are required to monitor transactions on and off our platform. […] Tools like KYT alerts, which provide real time and ongoing blockchain analysis, coupled with Gemini’s own compliance policies, help us meet our regulatory obligations.”
According to the article, the company’s KYT service has always included real-time transaction monitoring for large volumes of cryptocurrency activity to identify high-risk behavior. However, now alerts are generated whenever a transfer involves a risky counterparty and crosses a value threshold.
Major assets supported
Such alerts are divided into Severe, High, Medium and Low based on category, service, direct versus indirect exposure, direction of funds and amount. The supported assets include Bitcoin (BTC), Ether (ETH), Bitcoin Cash (BCH), Litecoin (LTC), top stablecoins and ERC-20 tokens such as Tether (USDT), Maker (MKR) and DAI. Chainalysis product VP John Dempsey commented on the development:
“As lawmakers and regulators focus their attention on the industry, it is more critical than ever that cryptocurrency businesses demonstrate compliance best practices. […] Every minute counts when managing exposure to sanctioned entities, hacked funds, darknet markets, and other illicit activities, which is why Chainalysis is investing in fast, actionable alerts to help our customers mitigate risk across cryptocurrencies.”
As CryptoX reported at the beginning of July, Chainalysis claims that 64% of ransomware attack cash-out strategies involve the laundering of funds via cryptocurrency exchanges.