In the world of cryptocurrency, exchanges and trading platforms need to adhere to some very strict guidelines and rules. DMG Blockchain Solutions recently introduced BitScore, which serves as a cryptocurrency deposit and withdrawal risk-scoring web API for AML and anti-fraud compliance.
BitScore can Make a Positive Impact
Trading platforms and exchanges dealing in cryptocurrency face a lot of scrutiny from regulators and governments these days. It is paramount that these companies pay close attention to developments in this industry and improve their protocols on a regular basis. Addressing any money laundering and fraud concerns must be a top priority.
Finding the right solutions to address those concerns is not easy by any means. DMG Blockchain Solutions may have come up with a tool that can help a lot of trading platforms out in this regard. Their new BitScore feature will make AML and anti-fraud compliance a lot easier to perform. Because this is a web API for cryptocurrency deposits and withdrawals, any suspicious activity should be flagged almost immediately.
This cloud-based API risk-scoring technology quantifies and manages the risk of legal non-compliance. Under the hood, BitScore uses an AI and machine learning model to examine the flow of cryptocurrency through the blockchain. It is an effective blockchain analysis solution which can make it easier for various trading platforms to adhere to compliance standards without needing to make major investments.
DMG Blockchain Solutions’ CTO, Danny Yang, commented:
Understanding the provenance of source and destination addresses is imperative for any exchange or payment platform sensitive to regulatory compliance. Allowing an address that accepts deposits from, or makes payments or deposits to, disreputable networks is potentially abetting their activity, which creates legal liability for banks, exchanges and traders.
As one would expect, BitScore takes many factors into consideration at all times. It even detects hops between transactions to determine the true origin of funds. It also applies a weighting function to identify potentially suspicious transactions along the way. It supports Bitcoin as of right now, but support for Bitcoin Cash, Ethereum, Litecoin, and ERC20 tokens will be introduced later on. All of these blockchains are fully transparent, which makes it a lot easier to identify transactions.
To make use of this API, users submit a cryptocurrency source or destination address. The system will subsequently determine the associated risk score and report it back. Considering that this solution analyzes the origin and destination of funds regardless of hops, BitScore makes it a lot easier to prevent suspicious transactions.