Major banks unwittingly process billions of crypto

The constantly changing world of crypto means all major US banks will have unregistered crypto businesses using their exchanges, report claims


Large banks may be processing up to $2bn (£1.5bn, euro1.8bn) in undetected cryptocurrency-related transfers each year, a new report says.

According to research by Blockchain intelligence firm CipherTrace, every one of the United States’ top 10 commercial banks have unregistered cryptocurrency businesses using their payments networks to process funds.

In a report in Cointelegraph, CipherTrace says these unregistered cryptocurrency money service businesses (MSBs) include entities such as crypto exchanges.

Both the US Bank Secrecy Act and Financial Action Task Force (FATF) require banks to identify the MSBs using their networks by law, the website said. However, CipherTrace claims that many are ill-equipped to adequately identify crypto exchanges because it can be difficult to identify them. New guidance being introduced across the G20 nations will make identification and compliance even more important, it says.

CipherTrace curates the world’s most comprehensive database of cryptocurrency exchanges and their operational status. It says that one challenge common to most financial service companies is identifying cryptocurrency exchanges that rapidly come and go.

In the “Wild West” of the emerging crypto economy, banks and financial institutions have trouble ensuring they are not inadvertently sending funds to or receiving funds from unregistered MSBs, it says.

CipherTrace analysts look at open, dark and deep web sources for fresh information on new exchanges and money laundering services. This research is critical because the cryptocurrency ecosystem is constantly changing and evolving.

Meanwhile, two more crypto firms are shutting down over impending EU money-laundering rules, according to The Block website. It said Crypto mining pool Simplecoin and bitcoin gaming platform Chopcoin are shutting down, citing forthcoming EU money-laundering rules.

FURTHER READING: $100,000 Bitcoin in two years predicts former crypto cynic

FURTHER READING: Russian darknet marketplace ICO: expansion or exit scam?

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