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Date: February 14th 2023
Published on: Press Room
Crypto AML, Crypto Compliance, Cryptoregulation, Virtual asset,
Scorechain’s CEO, Pierre Gérard, recently had an interview with BitCourier on how Scorechain assists companies in their crypto compliance journey. The interview was originally posted here.
We provide blockchain analytics and transaction monitoring software to help companies comply with crypto-asset regulations. As crypto assets are still relatively new, regulation in the field remains sparse and uneven. However, regulators are increasing their scrutiny of these assets by the day, and regulation in the space is evolving rapidly. This means that more and more firms are falling into the scope of anti-money laundering and combating the financing of terrorism (AML/CFT) regulations.
And complying with these regulations can be challenging for companies. So we provide the tools to help them facilitate their compliance process by understanding the flow of crypto transactions, the level of risks, and potential illicit activities related to money laundering and terrorism financing.
We work with two main types of customers: crypto-native businesses like exchanges, crypto payment platforms, wallet providers, token issuers, and also with more traditional financial institutions which are now entering this ecosystem.
Crypto-native companies use our tools to facilitate their compliance policies, while financial institutions need help adapting their current compliance strategies to crypto assets. We also work with any type of companies that wish to onboard crypto assets to their operations in a compliant way, like gambling platforms, payment gateways, etc.
Besides, we also provide on-demand investigation reports to accounting firms, NFT projects, investigators, and law firms, for example.
Currently, EU member states have to implement AML/CFT standards for crypto-assets according to directives at the EU level (AMLD 4, 5, 6). However, these directives are not being implemented evenly across the EU and do not form a comprehensive overview of the industry.
To close these regulatory gaps, the EU has been working on a new, more comprehensive regulatory framework since 2020, the Markets in Crypto Asset regulation, or MiCA regulation. MiCA will cover crypto assets, unbacked crypto assets, stablecoins, and crypto asset service providers such as trading platforms and exchanges.
The bill is expected to be voted on in the Parliament this year and should come into force in 2024. Once in force, the regulation will bring a lot of changes to EU crypto regulations. However, regulated companies will benefit from an 18-month transitional period, so it leaves them enough time to fully prepare for it.
Yes, we recently launched an all-in-one platform, with every feature accessible from the same interface. It’s the first integrated crypto AML compliance platform for transaction monitoring, risk assessment, and reporting processes.
Crypto transaction monitoring is complicated enough as it is. When revamping the platform, our goal was to offer the best experience possible to our users and the most user-friendly interface. And this is why we worked closely with our users and put a focus on the customer journey to achieve it.
Our customers are very different from each other. Therefore, we provide several ways to access our services: our standard interface, an investigation tool that is more of a graphical interface, a large range of reports, and also an API that covers all our features. This is a great tool to connect with third parties services like custody solutions and KYC services and also to integrate global compliance workflows.
The main feature is Scorechain Analytics, our transaction monitoring tool. It allows users to browse crypto transactions and wallets and link them to real-life entities with the associated level of risk and red flags in case of illegal activities. Users can customize different tool parameters, from scoring to alerts, and adapt them to their local requirements and existing policies.
Besides Scorechain Analytics, we also provide investigation and case management tools as well as a directory of virtual assets service providers for users to push their AML compliance process further.
I have been closely following Bitcoin and blockchain technology since 2014. After creating Yallet, one of the first Bitcoin wallets for iOS, we launched Scorechain in 2015, one of the first blockchain analytics companies. We launched the project to help crypto companies and financial institutions comply with related AML/CFT regulations on crypto assets and onboard them safely.
The recent events that occurred in the crypto market showed that there is a clear need for better governance. And this can be achieved with fair regulation of the crypto industry that will not only focus on AML/CFT but also on asset management, liquidity risk, and counterparty risk management.
We believe crypto can only thrive towards mass adoption with appropriate regulations that prevent criminal use of crypto assets and protect consumers while sustaining innovation and development in the industry.
In 2023, we will keep on improving our services and keep a close watch on regulatory developments. We plan to launch several additional features to the software to further facilitate compliance checks for our users.
Today, we support 23 blockchains, including Bitcoin, Ethereum, Tron, Tezos, and BSC, for instance, along with more than 10,000 assets. This year, we also plan to add support for additional blockchains for maximal coverage of the market.
Bitcoin is 14 years old, but I really think this is only the beginning!
Scorechain provides blockchain analytics and a transaction monitoring platform for crypto assets. As a leader in crypto compliance, the Luxembourgish company has helped over 200 customers in 45 countries since 2015, ranging from cryptocurrency businesses to financial institutions with crypto trading, custody branch, digital assets, customers onboarding, audit and law firms, and some LEAs.
Scorechain’s platform supports 23 blockchains and over 10,000 crypto assets. It can de-anonymize blockchain data and connect with sanction lists to provide risk scoring on crypto assets, transactions, addresses, and entities. The risk assessment methodology applied by Scorechain has been verified and can be fully customizable to fit all jurisdictions. 300+ risk-AML scenarios are provided to customers with a wide range of risk indicators so businesses under the scope of the crypto regulation can report suspicious activity to authorities with enhanced due diligence.