Crypto custody firm Qredo adds blockchain analytics to FATF's Travel Rule offering

Crypto custody firm Qredo adds blockchain analytics to FATF's Travel Rule offering

Qredo is bringing its APIs to the global push for cryptocurrency AML compliance.

Cryptocurrency custody and settlement technology company Qredo has thrown its hat into the ring of compliance solutions aimed at bringing digital assets in line with the Financial Action Task Force's (FATF) Anti-Money Laundering (AML) guidelines.

The FATF has already added companies that process crypto transactions, known as virtual asset service providers (VASPs), to its scope in mid-2019. The guidance requires exchanges, trading desks and custodians to submit personal data along with crypto transactions above a certain threshold, known as the "travel rule."

Qredo, which raised $80 million in funding earlier this year, is focusing on interoperability with other solutions such as TRISA, TRP, TRUST, Sygna, VerifyVASP and Notabene, the custodian said, while there is also an atomic swap option where both counterparties use Qredo's multi-party computation (MPC) custody infrastructure.

The Qredo approach is also useful in that it fits in with a number of blockchain analytics tools that many firms are already familiar with, according to Ben Whitby, the company's head of compliance. These include tools such as Chainalysis, Elliptic, TRM Labs, ComplyAdvantage, Coinfirm, VASPNet and Crystal Blockchain.

Whitby said most crypto companies Qredo has spoken with have invested a lot of time and money in training their staff to use one type of blockchain analytics tool or another, and that it makes sense to combine trading and compliance workflows with APIs, which is especially useful if the regulator wants to investigate a particular transaction.

"In the case of an investigation by an enforcement agency, you can seamlessly demonstrate that the right checks were done for a transaction: a sanctions check, metadata submission, receiver feedback and so on," Whitby said in an interview. "It's all there instead of pulling logs and doing a lot of tedious cross-referencing and reconciliation.