Although the future of blockchain regulation is uncertain, it will undoubtedly affect the way financial institutions use it
The adoption of blockchain technology across the financial services industry has the potential to revolutionize how governments, institutions, and individuals conduct transactions. Many regulators appear reluctant to address blockchain development out of a fear of stifling innovation, yet remain committed to strong enforcement action when bad actors use the technology to facilitate illegal activities. The application of machine learning techniques to monitor transactions on a blockchain may improve the efficiency and effectiveness of an institution’s anti-money laundering/counter-terrorist financing (“AML/CTF”) compliance program.
In this article, our experts explore how compliance officers can potentially mitigate their financial institutions’ AML/CTF risks through the combination of blockchain technology and machine learning, while ensuring that their institutions remain compliant with the current regulatory framework.