Cryptocurrency: Do You Know Your AML Risk?

When properly managed, cryptocurrencies can offer new revenue opportunities for FIs.

Boston, January 20, 2021–Against the opinions of many, the majority of cryptocurrencies are not bad or used for malicious purposes. Many consumers have built great wealth through investment and speculation in cryptocurrencies, and an increasing number of retailers are beginning to accept cryptocurrency as a form of payment. But generally, the financial services community lacks a deep appreciation and understanding of cryptocurrencies and their impact on the global financial system, and many financial institutions may unknowingly have crypto-related risk exposure. Financial institutions must act and respond now.

This report examines the increasing uses of cryptocurrency, the evolving regulatory landscape, the emerging crypto-related risks impacting financial institutions, and the quickly blossoming crypto-related AML technology solution market. The research was informed by Aite Group interviews with more than 30 executives from FIs, virtual asset service providers, and crypto-related technology software vendors in the U.S. and the U.K.; a survey of financial crime practitioners who attended Aite Group’s 2020 Financial Crime Forum; and secondary desk research.

This 46-page Impact Report contains eight figures and six tables. Clients of Aite Group’s Fraud & AML service can download this report, the corresponding charts, and the Executive Impact Deck.

This report mentions Acuant, Bakkt, Chainanlysis, CipherTrace, Circle, Coinbase, CoinsPaid, Confirm, CoinMarketCap, Crystal Blockchain, DBS Bank, Elliptic, Fidelity Investments, Galaxy Digital, Gemini, JPMorgan Chase, Jumio, Kraken, Metropolitan Bank, NICE Actimize, PayPal, Provident Bank, Quontic, Santander, Silicon Valley Bank, Silvergate Bank, Standard Chartered, Square, Travel Rule Information Sharing Alliance, and Upbit.

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