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How Crypto AML Software Will Help Improve Compliance In Banks



Crypto AML Software

How Crypto AML Software Will Help Improve Compliance In Banks 

Integrating crypto AML software in banks and financial institutions for compliance will help them align with current regulatory standards. As new regulations are introduced globally, virtual asset service providers (VASPs) need effective cryptocurrency compliance solutions.

Crypto AML Software

As traditional banks and financial institutions are exposed to crypto-assets and all the risks involved, they need to integrate a crypto risk management system. The question remains, what are the available solutions. To align with current regulatory standards, banks and financial institutions must comply with Anti-Money Laundering (AML) compliance.

Also Read: Proof-of-Work VS Proof-of-Stake

To achieve this feat, banks and financial institutions need to monitor the risks associated with blockchain transactions effectively. Banks have different levels of exposure to cryptocurrencies. However, most of them are exposed in some way. Currently, there are two categories of banks exposed to cryptocurrencies:

  • Direct Contact

These are crypto banks, trust funds, and financial institutions that directly contact cryptocurrencies. They serve as custodians of digital assets for their customers. For instance, In Germany and the United States, it is now legal for banks to have a digital asset custodial license. Meanwhile, there needs to be an added level of due diligence, transaction monitoring, and profiling for financial services.

  • The Indirect Contact

They include banks and financial institutions that do not deal directly with cryptocurrencies. Rather, they allow Virtual Asset Service Providers to have accounts. These financial institutions must ensure that the funds coming into their bank accounts are “clean.” The funds must not be connected to any suspicious activity before being converted from digital asset to fiat. This is where the crypto AML software comes into play.

Before we go further, let’s have a look at what crypto AML software is.

What is Crypto AML Software?

Crypto AML software aims to detect and disrupt money laundering activities that often happen in three stages: placement, layering, and integration. In itself, Anti-Money Laundering is a comprehensive process, regulations, and rules put in place to cohesively combat money laundering, terrorism funding, and other financial crimes. According to the United Nations Office on Drug and Crime, at least $800 billion are laundered globally in one year. This is the equivalent of 2% of the global GDP.

Despite all the checks, measures, and compliance, the rising cases of financial crimes continue to be a global challenge. This has continued to expose the weaknesses and loopholes of the traditional finance system. Over the years, traditional banks and financial institutions have been fined for policy and reporting violations under Anti-Money Laundering regulations.

Also Related: The Evolution of DeFi: Impact on Global Financial System

Netherland’s largest bank (ING Group) was fined $900M) for money laundering. Also, Deutsche Bank was fined $700M for inefficient Anti-Money Laundering processes. The Commonwealth Bank (Aussie FII) is to $700M fine for AML breaches. In the United States, the M.Y. Safra Bank was sanctioned by the U.S. Treasury Office of the Controller of the Currency for failing to report suspicious activity tied to crypto clients.

Despite the above-listed fines and many others not listed in this article, AML violations are yet to stop. This tells you that there is a need for a more holistic, efficient, and effective approach to tackle money laundering in traditional banks and financial institutions.

How Crypto AML Software Works

The cryptocurrency Anti-Money Laundering compliance software works as an automated risk profiler that records blockchain entity interactions. It also observes potential connections with other entities. The AML software depends on algorithms and behavioral patterns, and historical factors to develop risk profiles.

One of the many advantages of this solution is that banks can configure their monitoring systems to suit. The same principle applies to other service providers like cryptocurrency exchanges. Once you have configured the risk parameter, you can put alert systems in place. All transactions are monitored by the system 24/7. Therefore, the manual work needed to understand the origin of funds is minimized significantly. Also, most of the on-boarding and training time is minimized.

In today’s world, banks are no longer only monitoring fiat-to-fiat transactions; they now look into crypto-to-fiat and fiat-to-crypto transactions. Therefore, they need to work through the blockchain technology the transactions are built on. The major challenge for banks will be how to ensure data security with third-party compliance software. Banks could have hosted dedicated servers where all the data will be kept in-house on their company server.

Compared with traditional or paper AML procedures, crypto AML software is highly adaptable and can match the financial industry’s ever-changing dynamics. Although the benefits are huge, it will only be through active use by banks and financial institutions that we can fully understand the benefits and pitfalls of this technology. Like every technological innovation, testing will be the key to improvement.

The growing Adoption of Crypto services by Banks

Crypto assets are increasingly blending with traditional financial services and raising the AML compliance risks. Initially, banks were skeptical and reluctant to adopt crypto assets, but they have started to reconsider their earlier position. A good example is the J.P. Morgan Chase bank, which has launched its own digital coin. The coin is designed to make immediate payments using blockchain technology.

SBI Holdings, a subsidiary of SoftBank Group, entered into a joint venture with Ripple and other 61 different banks. This is evidence that traditional banks and financial institutions. At least 40 German banks applied for a new crypto custodian license that will enable them to provide professional custody services. In another development, Swiss private banking and wealth management group Julius Baer in partnership with Seba launched a digital trading and custodial service.

In the United States, banks like Simple Bank support cryptocurrency transactions. These banks also enable their customers to buy, sell, and invest in cryptocurrency. The National Bank of Canada is currently allowing its customers to buy cryptocurrency using their credit card.


As traditional banks and financial institutions adopt crypto assets, they need to integrate crypto AML software for compliance. Implementing robust AML analytics and intelligence tools will help banks fulfill their regulatory requirements and mitigate risks relating to crypto businesses. Kindly share your thought in the comment section provided below.




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What is Cryptocurrency And How Does It Work? 



Obiex finance website

Cryptocurrencies are decentralized digital assets that operate on blockchain technology that in turn operates by storing a ledger of every transaction on all nodes powering the blockchain. 

In layman’s terms, blockchain technology is like a record keeper, it collects data (in blocks) and links one block of data to another, forming a chain. The data on the blockchain is open for all to see and cannot be easily altered. Blockchain technology can be used for a variety of use cases besides cryptocurrency, ranging from voting to crowdfunding, keeping health records, etc.

Using Bitcoin as an example, nodes are computers connected to the network to mine Bitcoin,  – this collection of independent nodes working together is what makes the network decentralized.

The decentralized nature of cryptocurrency is down to the creators recognizing flaws in traditional banking & financial systems like governments and financial institutions acting only in their best interests and not in the best interest of the common man, leading Satoshi Nakamoto (the creator of bitcoin and blockchain technology) to take steps to rectify that.

Related: What are NFTs?

To make cryptocurrency transactions, you will need to have a set of both public and private keys that will act as passwords protecting your crypto wallet. 

The Public key is connected to your wallet address, allowing you to share the address with others to receive cryptocurrency, while the private key is known to only you and is what you will use to approve outgoing crypto transactions from your wallet. 

Trading Cryptocurrency on Obiex

Obiex finance website

With the popularity of cryptocurrency trading currently at an all-time high, the biggest challenge for many rookie traders is selecting which cryptocurrency exchange to trade on.

If you fall in this category, the immediate priority should be finding an exchange that allows rookie traders to make trades easily, doesn’t charge extra fees and is completely secure. That exchange is Obiex Finance.

In this guide, you will be shown how to navigate the Obiex mobile app & website easily and what to do to get started with making cryptocurrency trades. 

Getting started with Obiex Finance 

Obiex Finance is a digital asset exchange and financial technology (Fintech) platform that gives its users the ability to easily execute cryptocurrency trades from anywhere regardless of their skill level.

Their commitment to ensuring that users get the best experience is shown in how they allow instant swaps from volatile coins like Bitcoin to stable coins like USDT, and vice versa, without confirmations. In a market where the value of crypto can fluctuate wildly, this feature is especially valuable as it allows users to seamlessly switch between making profits to saving those profits in a more stable currency before the value drops.  

To create an Obiex Finance account, simply head over to their homepage, click on “sign up”, fill in the required fields and verify your email address. After that, create wallet addresses for your crypto assets and you’re ready to start trading!

The cryptocurrency available for trading on the Obiex Finance platform are: Bitcoin (BTC), Ethereum (ETH), Binance Coin (BNB), Polygon (MATIC), Dogecoin (DOGE), Tether (USDT), Binance USD (BUSD), and USD Coin (USDC).

Getting Started with Cryptocurrency trading

After creating your Obiex account, you need to follow these simple steps:

  1.     Have a Trading Strategy: Trading cryptocurrency without having a strategy in place is the easiest way to lose your money. You will need to research the various crypto trading strategies thoroughly and choose the one that best suits your needs and temperament. For example, if you’re a patient person who is content to make smaller, safer trades over a long period of time instead of making riskier trades, then scalp trading is the best trading strategy for you. There are also other crypto trading strategies such as Swing trading, position trading, Arbitrage, dollar cost averaging etc.
  2.     Pick the cryptocurrency you’d like to trade: There are several cryptocurrencies available on Obiex Finance such as Bitcoin, Ethereum, Binance Coin, Tether etc. Selecting which cryptocurrency to trade is usually down to making a choice; whether to stick with the safer, more established cryptocurrencies like Bitcoin or to go with the more volatile coins that have a high upside and an equally high-risk factor like the Dogecoin which can move in either direction based on what Elon Musk tweets.

It is also important to note that when you pick a cryptocurrency to trade, it would be wise to ensure that the cryptocurrency matches the strategy you pick. For example, if your preferred strategy is patient scalp trading, then investing in volatile coins that have a high upside but carry a lot of risk is not the wisest move. 

To swap crypto on Obiex Finance, add the wallet of crypto assets you’d like to swap, send the crypto to the wallet you just created, navigate to the ‘swap’ option on your dashboard, and select the coins you’d like to swap. You will receive the swapped coin in your wallet balance immediately without waiting for network confirmations.

  1.     Securely store your cryptocurrency: The same way you’d protect your goods and profits if you had a physical store is the same way you need to protect your cryptocurrency so it doesn’t fall into the wrong hands.

You can store your crypto securely on your Obiex wallet but if you want an alternative, physical wallets are also an option. Physical wallets allow you to store your crypto in secure hardware, offline storage device reducing the likelihood of online hackers stealing your hard-earned crypto. This is a list of reliable physical wallets you can use.


If you’re a newbie to crypto trading, the keyword is patience. Taking the time to properly understand the market before making trades will stand you in good stead. While risks occasionally pay off, a patient, long-term strategy is required to make consistent profits. For more information about trading as a newbie, you can check this out to understand unfamiliar crypto terms and to learn more about spot trading and futures.

Obiex Frequently Asked Questions | Obiex FAQs

  • Will I be charged a fee when I swap coins on Obiex? 

No you won’t. While other crypto exchanges charge for trades and require confirmations to execute swaps, Obiex allows you to make free, instantaneous swaps without the delay that comes with waiting for confirmation. This also helps you avoid unnecessary losses.

  • Can I trade crypto on Obiex if I don’t know much about crypto? 

Yes, you can! The Obiex Finance platform allows both rookie and experienced traders to make easy, safe trades regardless of trading experience.

  • Can I send and receive crypto easily?  

Yes, you can. To send crypto, you will use your private key to execute outgoing trades and your public key/your wallet address to receive incoming trades. You can also send and receive crypto using just Obiex usernames.

  • Why do I need to swap coins? 

Swapping coins allows you to either acquire a coin you think is (currently) more valuable than a coin you have a lot of. You can also use swaps to ensure that your funds are invested in a more secure coin like USDT if you feel the volatile coin you’re holding is about to go on a bear run and lose value.

  • Do I get a referral bonus when I invite friends to use Obiex? 

Yes, Obiex has a referral campaign that rewards users that invite their friends and family to trade the minimum of $10 on Obiex.




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