Most cryptocurrencies do not provide complete anonymity, but they do allow users to make large transfers without traditional banking procedures. This is what attracts malicious actors and makes digital assets a convenient tool for money laundering.
Stablecoins — digital equivalents of fiat currencies such as the US dollar — are especially popular in shadow schemes. According to Chainalysis for 2024, about 63% of illegal crypto transactions involved stablecoins, and the total volume of such transfers exceeded $40 billion.
To counter illegal financial flows and detect suspicious operations, regulators impose requirements on legitimate services such as exchanges, exchangers, and other crypto providers. A key part of these requirements is AML verification.
How AML verification works
AML verification is a set of procedures designed to determine whether crypto assets are connected to illegal activity. Modern AML tools detect not only the fact of interaction with suspicious coins but also evaluate the level of risk, identifying the source of “contamination.”
Assets considered “dirty” include coins involved in:
- money laundering;
- terrorism financing;
- scam schemes and fraud;
- theft, including exchange hacks and DeFi protocol breaches;
- other illegal operations.
AML verification is closely tied to regulatory standards:
- KYC (Know Your Customer) — identity verification of clients to reduce criminal risks;
- AML (Anti-Money Laundering) — a system of global measures to combat money laundering.
The primary purpose of AML verification is to detect and stop the circulation of illegal crypto assets, preventing their further circulation and attempts at legalization. With AML verification, exchanges and exchange services can identify suspicious addresses in advance and protect their infrastructure from receiving “dirty” coins.
Why AML verification is so important
According to Chainalysis, the volume of coins used for money laundering continues to grow despite a general decline in criminal activity within the crypto sector. This means that the risk of accidentally receiving “dirty” coins is higher than ever, especially when using unreliable services.
If a user receives “dirty” coins into their wallet, the address becomes “contaminated.” This may lead to situations where:
- A crypto exchange may prohibit deposits or withdrawals, and in some cases, freeze the user’s account entirely.
- The user’s wallet may end up on a blacklist, making it impossible to buy or sell cryptocurrency via official exchange services.
- The user may become involved in an investigation and face legal consequences.
- Freezing of coins or the entire wallet inevitably results in financial losses, and the unblocking process may take many months, or never succeed if the legal origin of funds cannot be confirmed.
How to reduce the risk of receiving “dirty” cryptocurrency
- Use reliable services for AML verification of cryptocurrencies and addresses.
- Store assets in separate wallets to reduce the risk of the primary address being completely blocked.
- Work carefully with P2P platforms*, especially those that do not require KYC. To minimize the risk of receiving “dirty” coins, it is safer to choose verified exchangers listed on BestChange.
- Before buying cryptocurrency from a private individual, verify their address using AML.
* P2P platform (Peer-to-Peer) — a service that allows users to exchange cryptocurrency directly with one another without a centralized exchange. On such platforms, trades occur between real people, while the platform acts as a guarantor.
Where to pass AML verification
AML verification is available on large analytical platforms such as Chainalysis, Crystal, CoinKYT, and GetBlock. However, these services act as professional aggregators and are mainly intended for corporate clients: they offer comprehensive monitoring and deep transaction analysis. For everyday users, such solutions are practically inaccessible due to their high cost and enterprise-focused model.
For regular users, AML verification became accessible thanks to specialized services that operate on the data provided by major analytical platforms. One such tool is the AML analyzer from BestChange.
To perform a check on BestChange, you only need to:
- Enter the wallet address.
- Choose the crypto asset and analyzer.
- Provide an email to receive the report.
The cost of AML verification on BestChange ranges from $0.00 to $1.00, depending on the chosen AML service.