Short but sweet. I’m going to just summarize what was discussed since it’s a fairly condensed topic that doesn’t focus too much on Bitcoin technology.
Money Laundering is the process by which individuals try to bring money gained from illicit means into the financial markets. Thus anti-money laundering job is to find and stop iti. It primarily focuses on larger amount of money that are being moved under the radar. However, even when one takes large transaction in banks, these are monitored and banks must comply with the laws.
Know your Customer (KYC) is a common phrase heard in financial institutions. The rules require business that handle money identify and authenticate their customers before handling these large scale transactions for them. It also means per jurisdiction, they need to watch the client for anomalous behavior and risky situations. Sometimes this process hurts legitimate behavior such as for gambling sites or companies that service the adult community. The lecturer presents certain US mandatory rules such as having to report transactions great than $10,000 and if they observe anomalous behavior, they need to file suspicious activity reports (SARs). To tie this to digital assets, people have used digital assets as intermediaries to get around these rules. Thus, on the same thread as the last lecture, people are watching these “fiat ramps”, places where people transition from fiat to digital assets. Banks also have the ability to shut down digital asset establishments because any business that handles large transactions even crypto must abide these rules.
Thus many exchanges or digital assets related corporations that could be classified under money services businesses need to be careful and watch closely to regulations. Law enforcement takes a strong and serious approach.