Coin Firm Brings Regulatory Wave to Ripple

Coin Firm Brings Regulatory Wave to Ripple


Cryptocurrency company Ripple has signed a deal with the regulation technology startup Coin Firm to garner anti-money laundering (AML) data and better understand how XRP, the company’s official asset, is being utilized.

Coin Firm Brings Stronger Protection Tactics Into Play

As regulation sweeps further across the crypto arena, many exchanges and related cryptocurrency enterprises are taking steps to ensure they fall in line and comply with set legislation designed to ensure they’re less vulnerable to hackings and malicious actors. Some of these steps involve invoking know-your-customer (KYC) tactics that shed light on users and ensure executives they are real people.

In addition, companies want to make sure the money they’re housing for clients don’t come from illegal or illicit sources. One of the services Coin Firm aims to provide to Ripple is ensuring customers’ money isn’t “mixed.” This involves checking to see if any funds garnered by clients don’t stem from privately exchanged funds from multiple parties. One of the top ways to keep illicit funds hidden is by “mixing” them with legal coins, while also sending large bundles of assets through multiple transactions to disguise the amount(s) in question.

Recently, Live Bitcoin News reported on the closing of BestMixer.io, a company that had allegedly been mixing and laundering illicit funds for years.

Coin Firm will not actually know the identities of address owners. Rather, it will see where cryptocurrency addresses come from – whether they originate from exchanges that permit anonymous or merely standard trading. It will then rank the addresses with a score between zero and 99, with 99 being the highest chance of money laundering.

The company’s CEO Pawel Kuskowski explains:

I won’t know who you are personally. We don’t do any personal data. We argue with [Financial Action Task Force] FATF that this is completely effective… Because you understand the profile, you don’t need the data of the sender because your internal systems are not able to process this data. It depends on how the FATF regulations will be rolled out in each country… We don’t believe you can run an exchange with coverage for only one currency or two major currencies because then your AML solution is invalid, and you can launder money through others.

Coin Firm first signed a contract with Ripple roughly two months ago. At press time, Ripple still holds approximately 57 percent of XRP units in varying accounts, meaning that more than half is not in circulation and still owned by the inventing company. Many argue that this makes XRP a centralized currency, though Ripple has denied this in the past.

Wait… Is This a Good Thing?

Kuskowski explains:

Having tools which allow clients to touch this particular protocol, this particular blockchain, this particular coin, is, in many situations, seen as a competitive advantage.

The post Coin Firm Brings Regulatory Wave to Ripple appeared first on Live Bitcoin News.



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