Binance signs deal with AML compliance firm

Binance, the largest cryptocurrency exchange by trading volume, has procured the services of cryptocurrency compliance solutions firm Chainalysis, to better ensure meeting anti-money laundering (AML) and know-your-customer (KYC) requirements.

The announcement on the Chainalysis blog comes at around the time members of the Group of 20 (G20) had committed to apply AML regulatory standards for cryptocurrencies.

Chainalysis Chief Operating Officer Jonathan Levin said, “Cryptocurrency businesses of all sizes face the same core challenge: earning the trust of regulators, financial institutions and users. 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.”

Binance Chief Financial Officer Wei Zhou said, “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.”

Chainalysis claims that its software, Chainalysis KYT (Know your transaction), is the only real-time transaction monitoring solution for cryptocurrencies, which works by “pattern recognition, proprietary algorithms and millions of open source references to identify and categorize thousands of cryptocurrency services to raise live alerts on transactions involved in suspicious activity.” The company, founded in 2014, has over 150 clients worldwide, including global law enforcement agencies and regulators.

Countries have provided regulatory frameworks that integrate AML compliance for the cryptocurrency trade. As of October 15 in Norway, new regulations cover “platforms that facilitate trading and exchanges by connecting buyers and sellers,” which exempts the trade of cryptocurrencies with other cryptocurrencies.

Australia has had its AML compliance legislation since April, which among other things requires exchanges to report transactions involving physical currency of AUD10,000 or more.

Last week, Binance delisted four altcoins, saying certain factors were considered, including “evidence of unethical/fraudulent conduct,” and “responsiveness to our periodic due diligence,” as well as quality of development, and communication with the public.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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New AML rules target crypto businesses in Norway

Effective Oct. 15, cryptocurrency-related companies in Norway—including branches of multinational companies—will have to adhere to a new set of anti-money laundering regulations (AML) set by the Financial Supervisory Authority of Norway, also known as the Finanstilsynet.

The new regulations apply to cryptocurrency storage services and providers offering exchange services between cryptocurrencies and fiats, as well as “platforms that facilitate trading and exchanges by connecting buyers and sellers.” Crypto-to-crypto exchange platforms, however, are exempt from the new Money Laundering Act.

Companies storing private keys on behalf of clients are considered to be involved in the transfer, storage or purchase of virtual currency. Therefore, all companies conducting such operations will have to follow these new laws. This, however, will not apply to companies offering private cryptographic key storage.

Companies in the crypto sector will have until January 15, 2019, to comply with the new Money Laundering Act, which stated: “The Ministry may in regulations lay down rules making this Act applicable to undertakings engaged in the mediation of financing by way of donation, and to exchange service platforms and custodian wallet providers of virtual currency.”

In explaining to what extent the new laws will apply, the authority stated that FSA has the duty to monitor money-laundering activities done by virtual currencies and storage providers. These new rules were created to stop potential illegal activities from taking place.

“Service providers are subject to the regulatory framework by virtue of the services they offer, regardless of how the service is organized. This also covers service providers that currently operate without being registered in the enterprise register, which operate over private accounts,” according to Finanstilsynet.

In addition, Finanstilsynet explained that crypto companies in Norway will be required to register with the authority and provide the necessary documents to show their operations. Finanstilsynet will also require customers to prove their identity and answer questions on the purpose of their transaction, the origin of their funds and so forth.

These rules also impose reporting requirements on crypto services providers in the country. However, this will not affect people who buy or sell their own cryptocurrencies for private purposes. It will also not affect these who occasionally assist friends and acquaintances with the purchase and sale of virtual currencies.

Companies who fail to comply with these new rules will have face penalties from the authority.

“Finanstilsynet will ensure that virtual currency exchange and retention providers comply with the money laundering rules. However, FSA does not have any tasks related to the monitoring of other parts of these providers, such as investor protection or advice requirements,” according to the government agency.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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Thai AML body seeks power to seize crypto assets

Concerned about the growing number of cryptocurrency-related crimes, Thailand’s Anti-Money Laundering Office (AMLO) is looking to expand its powers to allow for seizure of digital assets, including cryptocurrency wallets.

“We have discussed launching our own ‘AMLO Wallet’ to hold or confiscate digital currency from illegal sources,” AMLO Secretary Witthaya Neetitham said during a recent seminar in Bangkok, according to a report from news outlet The Nation.

The desired legislation would also come in handy for the confiscation of cryptocurrency earnings from other crimes. The Nation article cited a case where Thai police had arrested the operator of a child pornography website whose digital wallet contained THB123 million ($3.8 million). “We found bitcoin in his e-wallet, but had to leave it there because we don’t have any regulations [for such seizures],” Police Captain Ekkanit Nathethong said.

Witthaya said that AMLO did have authority over companies licensed by the country’s Securities and Exchange Commission, but when it came to unlicensed entities, “We cannot identify the cryptocurrency operator or receivers when duped victims transfer money to the criminals.”

Chartpong Chirabandhu, of the Office of the Attorney General, shared that prosecutors were limited in their ability to use electronic evidence in building a case against cybercriminals.

Recently, a Finnish businessman was defrauded of $24.4 million worth of cryptocurrencies by Thai suspects, who have since admitted to the crime and are participating in negotiations for the return of the stolen amount. The suspects had invested the funds of Aarni Otavi Saarimaa in three companies, before running off with the money.

Colonel Pisal Erb-Arb, deputy commander of the Narcotics Suppression Bureau, proposed a working panel tasked to fight cybercrime. “We need to hurry. Thailand is a haven for money laundering that finances terrorism,” said Pisal, who helped with the arrest of Alexander Cazes, founder of dark web marketplace AlphaBay, where users transacted in cryptocurrencies.

The Thai government has made several policy changes with its growing awareness of cryptocurrencies. Last month, the Bank of Thailand, the country’s central bank, reversed its earlier ban on banks engaging in cryptocurrency-related activities. Now, banks are permitted to create subsidiaries for the purpose of cryptocurrency transactions, issuance of tokens, and the like.

The SEC began its regulation of cryptocurrency-related activities last May, and has approved five exchanges and two dealers since.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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