Anti Money Laundering (AML)

The network of laws, rules, and processes known as anti-money laundering (AML) aims to expose attempts to pass off criminal payments as legitimate income. Money laundering seeks to cover up offenses like minor drug sales and tax evasion as well as public corruption and funding of terrorist organizations.

Cryptocurrency anti-money laundering (AML) refers to the policies, rules, and procedures that prevent criminals from turning illicitly acquired cryptocurrencies into fiat money.

The Financial Action Task Force (FATF) sets worldwide guidelines for anti-money laundering laws. Following the FATF’s publication of bitcoin AML recommendations in 2014, policymakers in FATF member states moved quickly.

The responsibility is subsequently passed to cryptocurrency exchanges, stablecoin issuers, and, in some specific circumstances, select DeFi protocols and NFT markets that the FATF has designated as virtual asset service providers (VASPs). To stop malicious transactions that could be connected to money laundering and terrorist funding, VASP’s senior authorities must require know-your-customer (KYC) checks and frequently monitor suspicious behavior.

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