As a reminder, Chainalysis is one of the most popular analytics companies in the cryptocurrency world. It is dedicated to finding criminals by analysing what is happening on the blockchain. Still, the transaction history stays in the blockchain forever, which makes it not always possible to track down cautious hackers and criminals.

Today, the company works with governments in dozens of countries, in addition to having four offices in world capitals. Read more about the history of the giant's founding and development in a separate article.


How banks are interested in cryptocurrencies

Here’s a quote from the official announcement of the partnership, in which they share their perspective on what’s happening. The replica was published by the news publication Cryptoslate.

BNY Mellon plans to integrate a full suite of compliance software from Chainalysis to assess crypto trends and risks.

Partnership between Chainalysis and BNY Mellon

The move is part of the bank’s strategy to offer cryptocurrency services to its clients. The integration will track the assets of the custodial platforms that BNY Mellon will offer to clients. Here’s a quote from Chainalysis representatives on the matter.

BNY Mellon is the best of both worlds: it has a reputation for being one of the most trusted banks in the world and for fostering an innovative and forward-thinking financial culture. We are proud to partner with them as they launch their digital asset business.

BNY Mellon

Chainalysis’ risk management software suite includes three main tools. The first is KYT, or Know Your Transaction, which monitors all cryptocurrency transactions in real time to identify ‘high-risk’ activity. The second is Reactor, which is an investigative tool that companies can use to perform due diligence on suspicious transactions. The third is the Kryptos database, designed to help financial institutions understand the risks that digital assets can pose.

But while in America crypto is finding its users even in the banking sector, in China the government crackdown on cryptocurrency enthusiasts continues. A new ruling by China's Supreme Court implies penalties in the form of fines or even prison terms for those found guilty of raising money through cryptocurrencies.

The court’s ruling states that transactions involving “virtual currency” used for fundraising can be prosecuted, with penalties varying depending on the amount of money raised. As a reminder, China previously banned fundraising for startups via crypto in 2017 amid a hype surrounding ICOs. Today’s ruling amends the country’s legislation, tightening controls on the already completely banned local crypto market.

China

The law comes into force on 1 March. The potential penalties could vary significantly depending on the amount of cryptocurrency involved in the fundraising. If the “offender” is found guilty, he could face up to ten years in prison, as well as a fine of up to 500,000 yuan, which is $79,000.

Before the complete ban on cryptocurrency mining in China last year, local miners accounted for most of the Bitcoin network’s hash rate. The business is now illegal in China, as are other digital asset transactions. The only way out is to work unofficially, but as you can see, Chinese law enforcement authorities will fight this in earnest.

Videocard for mining


We believe that this decision by bankers is proof of the popularisation of digital assets. Apparently, in the future crypto will be everywhere to interact with, and banks will surely want to become a layer between coins and less experienced users. So what's happening now really hints at the further development of the cryptocurrency industry.