American blockchain security firm CipherTrace will provide Anti-Money Laundering (AML) controls for Binance Chain and its native asset Binance Coin (BNB).
CipherTrace to increase AML checks on Binance Chain
Binance Chain, a public blockchain of major crypto exchange Binance and the underlying blockchain for Binance DEX, is expected to improve its AML procedures through CipherTrace, Binance announced on Nov. 5.
Specifically, CipherTrace will be providing Binance Chain with institutional-grade AML controls to increase adoption of the Binance Chain blockchain.
Within the initiative, CipherTrace will enable global developers, investors and regulators to access the Binance Chain blockchain for discovering data such as high-risk addresses. Moreover, CipherTrace will be helping those entities to set various controls to protect decentralized applications, exchanges or other crypto-based applications, Binance wrote in its blog post.
Customer data will not be shared with third parties, Binance COO says
Samuel Lim, chief compliance officer at Binance, claimed that the initiative will not affect Binance users’ security and data protection. Speaking to Cointelegraph, the executive noted that customer information will not be shared with third parties as a result of the new AML practice, adding:
“Users can rest assured that Binance will uphold its usual high standards of user security and data protection.”
Lim also denied to specify to Cointelegraph whether this move would affect listing of privacy coins such as Monero (XMR) in the future, saying that Binance does not comment on specific tokens and maintains the highest integrity in its listing due diligence process.
In the announcement, Lim considered the move as a “major win for the community-driven Binance Chain,” noting that Binance users can soon expect more digital token support across its ecosystem.
Meanwhile, online critics have outlined the third party disclosure risks associated with AML practices by companies such as CipherTrace and Chainalysis. Twitter account theonevortex wrote:
“Looking forward to chain analysis companies like @ciphertrace and @chainalysis getting hacked. These people sell your data to 3 letter agencies and governments WITHOUT your permission.”
CipherTrace recently expanded its platform to support 700 tokens
CipherTrace’s support for BNB and Binance Chain follows the recent expansion of CipherTrace services to up to 700 cryptocurrencies including Ether (ETH), Tether (USDT), Bitcoin Cash (BCH) and Litecoin (LTC) on Oct. 15. Claiming that CipherTrace has expanded to support 87% of the transactional volume of the top 100 cryptos, the firm denied to specify which cryptos will not be supported on the platform at the time.
On Oct. 21, CipherTrace CEO David Jevans argued that crypto regulations by global regulators such as those by the Financial Action Task Force’s would trigger a shift of criminal activity from Bitcoin (BTC) to privacy coins.