‘Huge Shift’ in crypto firms’ compliance mindset, says Elliptic co-founder
The crypto industry is increasingly prioritizing regulatory compliance, a shift noted by James Smith, co-founder of Elliptic. Initially, few companies took compliance seriously, with Coinbase being an early adopter. Regulatory interest, particularly from New York State, and the entry of traditional financial institutions like Fidelity and DBS Bank have driven this change. Fidelity launched its first crypto service in 2019, and DBS established a digital exchange in 2020. Compliance is now a global concern for exchanges, which are viewed as critical points for Anti-Money Laundering efforts. The recent Bybit hack exemplifies vulnerabilities, with the Lazarus Group using no-KYC decentralized exchanges to launder funds. Smith emphasizes the need for basic checks on liquidity providers to prevent such activities and questions the availability of liquidity for laundering stolen funds.
