In efforts to curb fraudulent transactions with digital currencies, leading South Korea cryptocurrency exchange Bithumb, announced it had integrated an investigative solution from Chainalysis, a blockchain analysis company.
The said solution, dubbed Chainalysis Reactor, is designed to investigate and monitor suspicious transactions on the crypto exchanges. This ensures the legitimacy of transactions on trading platforms.
Speaking on the latest development, the Chief Revenue Officer at Chainalysis, Jason Bonds, said that:
Chainalysis is committed to helping our customers investigate all kinds of illicit activity, including hacks and scams, and establish long-term regulatory compliance.
His comment shows that Chainalysis has the technology to investigate and track illicit activities conducted via cryptocurrencies. As such, Bithumb and other exchanges integrating the solution is a move towards curbing fraudulent crypto transactions.
Complying With South Korea New Rules
Bithumb’s move to tap into Chainalysis resources is also aimed at complying with the new rules by the South Korean government, which affects cryptocurrency exchanges in the country. The regulators mandated that trading platforms maintain specific standards of technology and compliance on the part of the trading platforms.
According to the new guidelines, exchanges must also get approval from the country’s financial services commission and the internet & security agency before they can render crypto-related services in the country.
Bonds further revealed that as the use of cryptocurrencies continues to go viral in South Korea, new regulations such as this will create room for vital compliance for blockchain analysis solutions like Chainalysis.
“We have had a presence in the South Korean market for over three years and are continuing to invest to ensure we provide top-notch, on-the-ground support for our customers,” he concluded.
The head of compliance at Bithumb, SungMi Lee, explains their confidence in the partnership with Chainalysis as they feel that they have chosen the industry-leading investigation software and professional guidance.
The country has been facing multiple hacks on crypto exchanges as they house some of the major digital currency exchange. However, with Bithumb being one of the most demanding markets for crypto exchange, one may expect that the company will gain due approvals off the back of the latest development.