Fireblocks Associates with Chainalysis to Offer Blockchain Compliance Security for Finance
Fireblocks Inc., an enterprise-grade platform for transferring, storing, and issuing distributed ledger blockchain assets, today declared the combination of blockchain data security firm Chainalysis Inc. to help financial institutions and cryptocurrency businesses comply with anti-money-laundering and finance security best practices. The Fireblocks will begin utilizing Chainalysis’s “know your transaction” technology to control cryptocurrency transactions in real-time.
Blockchain technology utilizes widely distributed ledgers to store historical records of transactions in a tamper-proof format utilizing cryptography and specialized proof of work to protect the privacy and assure trust in the network. Although this technology is beneficial for keeping a record of past transactions that can be certainly ensured to remain unchanged, financial companies still require to submit to audits, offer information on customers, and submit to third-party analysis for regulatory purposes.
Utilizing the Chainalysis platform, Fireblocks consumers will now obtain access to receiving AML-approved funds, customizing transaction policies based on assigned risk scores, automatically logging AML transaction reports, and placing them into operation the capacity to share such reports with regulatory bodies. “Both security and compliance are integral to building trust in the cryptocurrency industry,” said Jason Bonds, chief revenue officer at Chainalysis in a statement. “By bundling product offerings with our integration partners through the Chainalysis Partner Program, we are ensuring our customers adhere to security and AML best practices, ultimately making cryptocurrency more accessible for all.”
Blockchain technology carries the $117.8 billion cryptocurrency token market for Bitcoin, which has become the world’s most tremendous cryptocurrency asset. The technology has also been investigated by various token and asset issuance companies in an effort to combine the technology into financial industries.
Financial technology examples involve R3 CEV LLC’s foray into cryptocurrency token assets for the business, Ant Financial’s OpenChain blockchain platform for small business, banking, and payments startup Sila Inc. and fintech-focused blockchain platforms Spring Labs Inc. and PeerNova Inc. MasterCard Inc. also launched a cross-border payments solution pilot with R3 CEV LLC in September utilizing blockchain technology to speed up transactions greatly.
According to a report from MarketsAndMarkets, the fintech blockchain market is anticipated to increase to $6.2 billion in 2023 from an estimated $230 million in 2017. Drivers for this growth involve higher compatibility for blockchain with financial services, rising cryptocurrency market capitalization, and the ongoing trend of businesses adopting cryptocurrency tokens for asset exchange. Any time money is transacted between parties, and it can fall under the purview of regulatory agencies in the nations where transactions happen. That puts a burden on the company involved in the transactions to comply appropriately with any regulations.
As transaction volume rises, so does the complexity of putting up with reporting for these regulatory purposes. To alleviate this burden, Chainalysis “know your transaction” technology enables businesses to recognize and monitor high-risk transactions in high volumes, thus enabling the company to concentrate on the most sensitive activity and fulfill regulatory obligations to report suspicious activity. Fireblocks can now automate workflows for consumer financial institutions and provide them the best support possible concerning reporting for compliance purposes. Both Fireblocks and Chainalysis consider that it will further the adoption of blockchain technology in the financial sector.