What is AML for Crypto Exchanges?
For entities engaged in cryptocurrency exchange services, Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CTF) compliance are essential legal obligations. These regulations are designed to prevent the misuse of digital asset systems, including crypto transactions, for concealing illegally obtained funds or financing illicit activities.
Crypto exchanges are required to perform specific checks on both current and potential clients to establish business relationships and to continuously monitor these relationships. This is vital to safeguard your digital asset operations from being exploited by individuals involved in financial crime.
How to Ensure Crypto Exchange Compliance with AML & CTF
While specific AML regulations might vary depending on your jurisdiction, the core principles generally require crypto exchanges to conduct thorough identity verification of clients before establishing a business relationship. This typically involves the customary Know Your Customer (KYC) and Due Diligence procedures.
Additionally, crypto exchanges are mandated to screen all existing and new clients against international Sanctions Lists. These lists encompass individuals, organizations, and entities linked to illegal activities such as money laundering, terrorism, and other financial crimes.
This process, known as Sanction Screening, is a vital aspect of ensuring AML compliance for crypto exchanges. At ZenDetect, we specialize in automating your Sanction List screening, allowing you to focus on your crypto operations while we handle your AML compliance needs.
A pivotal aspect of AML compliance in the realm of cryptocurrencies is ongoing monitoring. Often, crypto exchanges perform Sanction Screening only once, typically at the start of a business relationship, or infrequently due to the complexity of the process.
With ZenDetect, your Sanction Screening becomes an automated and continuous process. Activate it once, and we'll seamlessly perform Sanction List screening on both new and existing clients. This ensures you achieve 100% AML compliance with ease.