From a technological purview, experts believe that for running a crypto business, one requires tools that can help the venture monitor transactions, identify suspicious activity, and get solutions to address it. Reportedly, blockchain analysis platforms utilise blockchains to provide these services to cryptocurrency businesses and financial institutions, as stated by Chainalysis.
Insights from Chainalysis emphasised that even though cryptocurrencies offer opportunities for revenue growth, it can also bring the risk of illegal activities. It is suggested that crypto businesses must act in accordance with the laws, mandated by their concerned jurisdiction. Upon failure of compliance, the events can lead to fines and other negative outcomes for organisations.
Experts believe that with increasing media coverage around crypto scandals, handling risk can develop trust with new and existing users, based on international anti-money laundering regulations such as Know Your Customer (KYC) requirements, transaction monitoring, filing suspicious transaction reports, recordkeeping, among others. Blockchain analysis tools can provide businesses data needed to execute operations, as highlighted by Chainalysis.
Moreover, Chainalysis mentioned that a good blockchain analysis platform should provide real-time detection and identification of high-risk crypto activity, along with a view of organisation and user risk through dashboards. Also, it should permit compliance teams to modify alerts based on their risk-based approach and ensure case management for reporting and collaboration between peers and regulators.
Market analysis suggests that standard tools should provide surveillance of an easy-to-use interface, supported by industry intelligence and a real-time API. They should have the capability to decrease manual workflows, help one address potentially suspicious activity by detecting patterns, and support safe interaction with blockchain technologies such as DeFi. These platforms should be able to configure real-time alerts based on an organisation’s anti-money laundering policies. Transaction monitoring can also help crypto businesses follow the Travel Rule. The platform suggested that a good blockchain analysis tool can ensure assessment and investigation of smart contracts, non-fungible tokens (NFTs), chain hopping, and other protocols.
(With insights from Chainalysis)