Launching an ICO? Learn Why KYC and AML Compliance Matters

An Initial Coin Offering (ICO) takes one asset (such as ether or bitcoin) and redeems it for a token that can be freely transferred, and traded for other cryptocurrencies or fiat currencies on exchanges present worldwide. This mechanism poses a major risk for ICOs being used for laundering proceeds of crime. By redeeming cryptocurrency for tokens, ICO issuers are potentially exchanging cryptocurrency that originated from the illegal activity for fresh tokens that can then be sold for US Dollars, Euros or other fiat currency. Regulators in China, Hong Kong, Russia, Singapore, Switzerland among other countries have sought to bring ICOs within the boundaries of KYC (Know Your Customer) and AML (Anti Money Laundering) controls.

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