2019 Crypto Compliance: Year in Review

by Marina Khaustova

Dec 27, 2019

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Overview of the 2019 Global Cryptocurrency Compliance Industry

2019 was a year of preparation and standardization for the cryptocurrency industry, as regulators around the world came together to enforce tangible legislation impacting the ecosystem. In the U.S., SEC Chairman Jay Clayton spoke candidly to a Senate Committee in December, informing them that the SEC is taking a measured yet proactive regulatory approach to crypto that will both foster innovation and capital formation while protecting investors and U.S. markets.

In June 2019, the Financial Action Task Force (FATF) published its “Guidance for a Risk-Based Approach to Virtual Assets and Virtual Asset Service Providers” giving countries until June of 2020 to implement these guidelines. The EU’s 5th Anti Money Laundering Directive (5th AML Directive) also included a definition of cryptocurrencies, as well as more advanced AML regulatory requirements for obligated entities. The EU Member States have to transpose the requirements of the 5th AML Directive by 10 January 2020.

Some countries have already begun to change their legislative frameworks in advance of these major global regulatory changes. South Korea has already begun taking legal measures to stamp out unregistered exchanges, and financial regulators in Singapore will introduce a Payment Services Act in January 2020. China has also taken steps to advance KYC legislation ahead of the release of their state cryptocurrency.

Crystal Blockchain’s International Bitcoin Flow Report highlighted just how much regulation has influenced (and will continue to influence) the flow of bitcoin and other cryptocurrencies between registered and unregistered exchanges. The team has also published an interactive fund flow map on its website with updated data and statistics from the report.

Access the Bitcoin Flow Interactive Map

Overview of Bad Actors & Malicious Activity with Crypto in 2019

The use of bitcoin for darknet market operations has undoubtedly seen an increase in activity in recent years, but now it’s easier than ever to track these activities due to the public blockchain’s transparency and immutability. The Crystal analytics team has created a report on darknet activities and bitcoin to analyze and measure bitcoin use on the dark web.

Read the Darknet Activities & Bitcoin Report in Full

Crystal’s Crypto Compliance

This year, we aggressively pursued updates and improvements to our platform to make it easier for our clients to comply with upcoming 2020 regulations. The team has been enhancing due diligence practices and account reviewing for our customers by enhancing our risk storing tools and creating a concise case management system for shared investigations. We have also added customizable alert functionality as well as additional fund flow verification for enhanced risk management.

Our platform now supports analysis of four major cryptocurrencies: Bitcoin, Ethereum (as well as ERC20 and ERC721 tokens), Bitcoin Cash and Litecoin. Our public blockchain and wallet coverage continues to grow and our algorithms reviewing these blockchains continue to improve. In compliance with current and future regulations, Crystal Blockchain’s advanced risk-scoring algorithm and address-listing function is based on information gathered from known sanctioned entities.

We are looking forward to the year ahead in crypto compliance. We will be adding more currencies to the platform soon, including Tether & Ripple, and we will be continuously updating our platform settings for easier and more efficient compliance and investigation.

Book a Demo to see the Crystal platform in action

We would like to take this opportunity to thank all of our clients for your continued support. We wish you a happy holiday season — see you in 2020!


The Crystal Blockchain Team

See the Crystal Blockchain platform in action. Get a demo today

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