Lawyers for KYC Blockchain & Cryptocurrency Compliance

Blockchain attorney Dr. Nick Oberheiden

Attorney Nick Oberheiden
KYC Blockchain & Cryptocurrency Compliance Team Lead
Blockchain attorney Alina Veneziano

Attorney Alina Veneziano
KYC Blockchain & Cryptocurrency Compliance Team Lead

Hire Experienced KYC Blockchain & Crypto Compliance Lawyers

Blockchain businesses (businesses using blockchain technology) should be worried about KYC (know-your-customer) checks. Federal regulations on KYC and other policies apply to most blockchain businesses.

If you don’t know how to implement KYC checks for crypto transactions, or how to strengthen existing KYC policies and more, consult experienced KYC blockchain and cryptocurrency compliance attorneys.

Cryptocurrency exchanges lose billions yearly. KYC and AML (anti-money laundering) procedures and policies can help reduce such losses significantly. The policies prevent theft and other types of crime by ensuring a company conducts businesses with only those persons who pass identity verification checks.

Since federal government agencies have already displayed their willingness to pursue cryptocurrency exchanges and other blockchain entities that don’t have or have failed to implement KYC policies, the importance of expert KYC compliance help can’t be overlooked.

Don’t wait for federal investigations or enforcement actions because of KYC compliance issues.

At blockchainlawyer.com, we have experienced KYC attorneys and experts in other related fields that can tackle KYC compliance, KYC charges, and other blockchain or cryptocurrency-related federal issues.

Let us help you if you run a blockchain company or if your company transacts in cryptocurrencies. Put our KYC compliance team by your side and eliminate compliance risks.

Introduction to KYC Policies & Procedures

KYC (Know-Your-Customer) policies are meant for identifying and verifying customer details before they can use a company’s services.

KYC policies are particularly important for businesses that facilitate cryptocurrency transactions (such as cryptocurrency exchanges) because most crypto transactions involve/offer anonymity. They also have other features like speed and little or no transaction fees that make them perfect for criminal elements.

KYC policies ensure a company deals with known and legitimate persons and entities only. The policies also stop sanctioned or prohibited persons or entities from transiting. KYC procedures and policies are part of US and international regulations followed by many institutions worldwide to prevent terrorism financing and money laundering. With KYC measures in place, a company can find and lock out high-risk entities and persons.

Regulations on Blockchain Companies, Cryptocurrencies, and Related Issues

Establishing and running a crypto exchange or blockchain company isn’t illegal in the US. However, some federal requirements must be followed. Companies must meet many requirements and obligations on a wide range of issues, including ensuring they know all their customers and deal with only those that pass the KYC /AML threshold.

Regulations relating to cryptocurrency transactions are enforced by federal agencies such as the SEC (Securities Exchange Commission), DOJ (Department of Justice), CFTC (Commodities & Futures Trading Commission), FBI, IRS, FTC (Federal Trading Commission), OCC, and FinCEN.

Generally, blockchain companies or those dealing in crypto transactions are required to be licensed by FinCEN to run a money transmitting business (exchange). The companies will also be required to use AML/KYC checks when registering clients. What’s more, they should report suspicious customer account activity and comply with the required reporting and recordkeeping guidelines.

There’s obviously more to regulations and blockchain companies or those companies that transact in crypto. If you have questions about this and more – i.e., how your business can be impacted by KYC compliance and other matters – Contact us today.

How to Implement KYC Policies & Procedures

Cryptocurrency exchanges, cryptocurrency mining companies, and other blockchain-dependent companies are evolving at a record pace and transforming into non-banking financial institutions. This transformation needs to be met by good KYC policies and procedures in the companies’ operations.

Non-banking financial institutions need KYC policies implemented in AML compliance programs. In the US, FinCEN is responsible for cryptocurrency exchange regulation as per the BSA (Bank Secrecy Act). FinCEN requires KYC policies and procedures to be present and implemented effectively. What’s more, a company must have comprehensive AML measures.

Typical KYC policies and procedures will require customers to provide identifiable information (such as full names, address, DOB) that are then checked against government-issued documentation like a passport or driver’s licence. To verify information like an address, a recent utility bill is required.

Before a client’s application is considered, all verification processes must be complete. This may involve checking their details against global sanctions lists and checking other red flags. Once assessment is complete, the company can approve the client as there are assurances that they are transacting business with an honest client who comes with little to no risk of committing crimes like money laundering and terrorism financing.

Customers who don’t pass these checks are automatically rejected or required to upload more documentation for more thorough checks.

Benefits of KYC Compliance

KYC compliance shouldn’t just be done to avoid regulatory problems. Companies with KYC compliance obligations stand to enjoy other benefits like:

  • Increased trust. The trust placed in an online exchange or blockchain company is bound to increase if only customers that pass KYC/AML checks are allowed.
  • Reduced and sometimes prevented risk of a company being used to commit financial crimes since high-risk entities and persons are prohibited.
  • Showing federal agencies that your company has the goodwill to comply with the law.
  • Ensuring risk assessment is done in accordance with the regulatory, legal, and compliance landscape.
  • Preventing harsh regulatory enforcement actions like hefty penalties should your company be non-compliant with KYC/AML requirements.
  • Boosting public awareness on the importance of KYC/AML checks.

Our KYC compliance team can assist in all KYC compliance matters, from designing policies to implementing them and ensuring they are used to meet the end goal. Contact us today. We have a complementary KYC compliance consultation.

Get Legal Help on KYC Policies & Procedures

The regulatory environment for blockchain companies, online cryptocurrency exchanges, and other companies transacting in cryptos is constantly changing. KYC policies are among those regulations that keep evolving.

Companies required to abide by KYC/AML rules must be proactive to avoid federal agency investigations, charges, and enforcement actions. Companies like crypto exchanges have an obligation to ensure they accept only those customers who pass the required KYC checks, as this reduces the risk of money laundering and other crimes like terrorism financing.

KYC compliance can be the difference between profits and losses for cryptocurrency exchange companies. Compliance can also avoid costly federal investigations, which come with implications like reputation damage, hefty fines and/or jail terms for company executives found complacent or guilty of allowing crypto-related crimes.

At Blockchain Lawyer, we have the attorneys and consultants to ensure you achieve KYC compliance and avoid federal investigations and costly enforcement actions. We can also represent clients facing KYC or related compliance charges.

Let us assess your exposure, identify regulatory gaps, and design effective KYC policies and procedures unique to your business. Contact us now and claim a KYC compliance consultation.