Binance Integrates Chainalysis KYT Compliance Solution To Monitor Suspicious Transactions
Chainalysis, a company that specializes in compliance and security, has announced that Binance will be integrating its Know Your Transaction (KYT) compliance solution into the leading crypto exchange.
Chainalysis, a company that specializes in compliance and security, has announced that Binance will be integrating its Know Your Transaction (KYT) compliance solution into the leading crypto exchange reveals a press release published Wednesday, October 17, 2018.
The deal between Binance, the world’s largest digital currency exchange platform by volume, and Chainalysis could see it significantly improve its security by enabling it to detect and monitor suspicious activities.
Exchanges in the nascent crypto industry continue to face several challenges, chief among them being the tricky meeting point between crypto assets, regulatory requirements, and the mistrust it meets from legacy financial institutions.
Binance, which has sought to expand its services across the globe, faces these problems too. Top of its challenges is how to navigate the different regulatory landscapes, where demands by regulators vary.
Expanding into these markets means that the Binance team needs to ensure they comply with local anti-money laundering (AML) and Know-Your-Customer (KYC) regulations.
According to the press release, adopting the Chainalysis technology makes these processes much more comfortable and faster for exchanges than any other out there in the market.
The firm says that its compliance software will provide real-time monitoring of every transaction made on Binance’s platform.
Binance is seeking to have its platform ready for further growth and implementing AML and KYC rules is a necessary step it has to take. The exchange’s financial officer Wei Zhou reiterated on this, saying:
“By working with Chainalysis, we are able to continue building a foundational compliance program that enables the next phase of our growth, […] Our vision is to provide the infrastructure for a blockchain ecosystem and increase the freedom of money globally while adhering to regulatory mandates in the countries we serve.”
Zhou also noted that their goal is to “create an environment” in the crypto industry that makes all users “feels safe.” The Binance CFO said that the fight against the problem of money laundering should take both a “collaborative” as well as pro-active approach.
Chainalysis co-founder and COO Jonathan Levin said:
“We expect many to follow Binance’s lead to build world-class AML compliance programs to satisfy regulators globally and build trust with major financial institutions.”
First released in April and dubbed know-your-transaction (KYT), the Chainalysis solution uses a complex algorithmic approach to sift through transactions. The KYT software then raises “live alerts” when it encounters a transaction deemed to exhibit suspicious activity.
According to Chainalysis, its KYT solution has been designed to aid crypto businesses as well financial institutions comply with KYC and AML regulations, making it easier for crypto-related companies to open and operate bank accounts.
Chainalysis serves more than 150 crypto businesses and has said that partnering an industry leader like Binance provides it with a chance to lay a foundation that will see the development of credible and robust cryptocurrency markets.
The crypto analysis firm has previously worked with Europol, providing information on how digital assets can be used to facilitate money laundering.
It has also participated in the research program that showed that users who lose their private keys had contributed to a high number of Bitcoins being declared lost.