Crypto intelligence firm CipherTrace has added support for the blockchain network Binance Smart Chain (BSC). The integration will give onlookers the tools to identify any suspicious on-chain activity.
BSC was developed by the crypto exchange of the same name and is akin to Ethereum in that it allows developers to build various applications atop the network. It is, however, far more centralized. At press time, there are over 4,000 Ethereum nodes verifying transactions in the network. BSC has only 21.
“One of the advantages of our data attribution system is that once we add analytics for a blockchain, we also add support for all applications built on that network,” explained CipherTrace CEO Dave Jevans in an announcement shared with Decrypt today.
The new functionality allows crypto service providers such as exchanges, banks, over-the-counter trading desks, custodial wallets, and other financial institutions to flag suspicious transactions on BSC and help prevent illegal activity like fraud.
Researchers at CipherTrace have recently suggested that rapid growth of the crypto industry would “inevitably” lead to an increase in illicit activity.
“Сompliance with global Anti-Money Laundering regulations is paramount,” added Samuel Lim, chief compliance officer at Binance. He hopes that the integration will also bring credibility to the network.
Meanwhile, Binance, the exchange, is currently under investigation by the U.S. Justice Department and Internal Revenue Service.
We take our legal obligations very seriously and engage with regulators and law enforcement in a collaborative fashion. (1/3) https://t.co/68UB1InOBK
— Binance (@binance) May 13, 2021
Law enforcement officers are trying to determine whether the exchange’s employees or customers were involved in money laundering and tax evasion.
“We have worked hard to build a robust compliance program that incorporates anti-money laundering principles and tools used by financial institutions to detect and address suspicious activity,” Binance stated in its reply.
Thus, an additional layer of compliance support from CipherTrace definitely wouldn’t hurt.