De-risking Crypto and Digital Assets

De-risking Crypto and Digital Assets?

By: Prime Trust
Published On: February 12th, 2021

Cryptocurrencies and alternative assets have brought fresh deposits into the financial system, piquing the interest of a new generation of investors who want to transact globally with ease and security. 

Today, it’s not hard to find a new public or private company announcing their belief in the future of crypto. Mastercard, for example, just announced that it will allow merchants to accept select cryptocurrencies, in addition to the recent news about Tesla purchasing $1.5 billion worth of bitcoin and planning to accept BTC for payment. 

However, in order to offer, accept, and transact digital assets, institutions must employ a robust compliance program to enhance security and mitigate fraud and liability. 

Here are the top five considerations to de-risk digital assets: 

1. Managing the risk means understanding the risk. A strong compliance program is your best defense against illicit activities. Effective compliance must be scalable, provide global coverage, and integrate a wide range of data sources to cover the broadest scope of individual and institutional customers. 

2. Regulation around cryptocurrencies changes frequently. A dedicated digital asset compliance program adheres to federal and state financial regulation, providing certainty that your organization continuously meets requirements.  

3. Effective compliance includes enterprise-grade know-your-customer (KYC) and anti-money-laundering (AML) rules and restrictions. This extends beyond customers to transactions, regulators, and authorities,as well as secure custody of assets. 

4. Fraud threats are constantly shifting. Know-your-transaction (KYT) technology tracks the origin of blockchain-based transactions and structured regulatory compliance (SRC) ensures compliance with regulators and authorities across jurisdictions.

5. Custody is at the center of a digital asset platform, managing the in- and-out flow of assets. Qualified custodians provide additional layers of risk management by undergoing regulated external audits, state licensing procedures, SOC reporting and auditing, and ISO certification. 

Digital assets are made easy with Prime Trust’s financial infrastructure

Prime Trust provides easy on-ramps to digital assets, complete with robust and trusted compliance, custody, liquidity, and settlement APIs that provide strict controls and restrictions. 

Specifically, our Compliance API is driven by the Bank Secrecy Act and provides scalable KYC and AML. Individual and institutional programs integrate a wide range of data sources, watchlists, fraud databases, and document verification services to surface any potential point of risk and produce highest quality results at scale.

We partner with industry-leading data repositories for identity verification and fraud detection  enabling us to go a step further than simple verification and detect bad actors even when they’re using stolen identities. Our in-house data science team monitors transactions for suspicious activity and rejects those users before they have a chance to wreak havoc on your business.

Prime Trust’s web apps and APIs support full beneficial ownership modeling allowing entirely online onboarding of institutions to minimize friction without cumbersome PDFs. 

Our Compliance API includes: 

  • Individual KYC & AML

  • Institutional KYC & AML

  • Global coverage & sanctions screening

  • Transaction monitoring and blockchain analysis 

  • Risk management 

  • Automated document checks 

  • Compliance officer exception review spans passports globally 

  • Zero chargebacks via Prime Indemnity 

  • ISO and SOC1 certified with regular external audits 

Provide safe and secure access to crypto and digital assets. Learn more about Prime Trust Compliance.

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