The Bank for International Settlements (BIS), which is skeptical about cryptocurrencies, has introduced a new proposal aimed at combatting money laundering in the crypto industry.
Proposal for Cryptocurrency Scoring System
BIS has proposed an anti-money laundering (AML) compliance scoring system for cryptocurrencies. According to DLNews, this system aims to enhance efforts against money laundering and identify cryptocurrencies linked to illicit activities.
How the System Works
According to BIS researchers, cryptocurrencies would be scored based on their transaction history. Cryptocurrencies that frequently pass through suspicious wallets or protocols often used for laundering stolen funds may receive a lower score. Additionally, exchanges in each country would block the conversion of cryptocurrencies into fiat if their score falls below a certain threshold.
BIS Views on Cryptocurrencies
BIS highlighted the benefits of this system, such as enhancing security by reducing the flow of illicit funds through the crypto ecosystem and increasing trust among institutional investors. The bank has recently reiterated its skeptical stance towards cryptocurrencies, emphasizing that they pose risks and could undermine financial stability.
The proposed scoring system may represent an important step in the fight against money laundering within the cryptocurrency space, even as BIS maintains a cautious approach towards the nature of cryptocurrencies.
