Malta Fin Regulator Taps CipherTrace To Monitor Crypto Transactions

Blockchain, News | March 12, 2019 By:

The Malta Financial Services Authority (MFSA) has appointed blockchain security company CipherTrace to monitor and manage business risks related to Malta licensed virtual asset businesses and cryptocurrencies.

CipherTrace develops cryptocurrency intelligence, anti-money laundering (AML), blockchain analytics and forensics, and compliance solutions. These products are used by government, regulators, law enforcement investigators and auditors to enforce AML laws, combat crime and reduce fraud. Cryptocurrency exchanges also use the platform to comply with AML laws. Banks use CipherTrace to mitigate threats related to customer cryptocurrency activity.

The MFSA will be using the CipherTrace Compliance Monitoring solution to manage the risk associated with cryptocurrency businesses to protect consumers, investors and business partners. The solution helps regulators evaluate and monitor the trustworthiness of virtual asset businesses by using machine learning technology to de-anonymize transactions. It tracks the risk exposure of crypto businesses including cryptocurrency exchanges, collective investment schemes and initial coin offerings (ICO) to gauge and measure potential exposure.

“Being strongly aware of the money laundering and financing of terrorism risks associated with entities operating in this sphere, the decision has been taken to engage the services of CipherTrace in order to reduce fraud and detect transactions with illegal sources of funds,” said MFSA Chief Executive Officer Joseph Cuschieri. “CipherTrace Compliance Monitoring will provide the MFSA with powerful oversight tools to automate regulatory processes and audit the risk management of virtual asset businesses that are licensed in Malta.”

Dave Jevans, CEO of CipherTrace, said that the company’s solution will allow the MFSA to monitor the activities of crypto businesses both pre- as well as post-authorization stage.

“Cryptocurrency businesses often have difficulty establishing trust and maintaining banking relationships because of their perceived risk,” Jevans said. “Banks and other financial institutions use the CipherTrace Compliance Monitoring solution to help decide which virtual asset businesses to trust as corporate customers. These insights help banks avoid de-risking by turning away valuable customers in this lucrative and fast growing sector.”