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DMG Blockchain Solutions Deploys Bitscore API For AML And Anti-Fraud Compliance

May 7, 2018, 10:23AM
1 min, 39 sec READ

DMG announced the Bitscore AML and anti-fraud compliance solution, as regulators struggle to trace the source of illicit Blockchain transactions.

DMG Blockchain Solutions Inc. (TSX-V: DMGI) announced the launch of Bitscore on May 7th. The new web API will assist in DMG's compliance with Anti-Money Laundering (AML) and anti-fraud policies. This represents a possible way forward for blockchain-based companies who will increasingly need to follow AML and KYC laws as the legal framework around the cryptocurrency market strengthens. 

Developed by DMG’s Blockseer team, the cloud-based Bitscore app is a triple-feature product; clustering, address labeling, and risk scoring. It utilizes artificial intelligence and machine learning models to identify the provenance and destination of the cryptocurrency flow on a Blockchain. Users can input a Blockchain address and Bitscore will look at transactions several generations in different directions and then apply calculations that capture the proportion of tainted cryptocurrency flowing through the transactions in question. Bitscore then produces a risk rating about that Blockchain address's involvement in questionable transactions.

Regulatory compliance is likely to be essential for cryptocurrency exchanges and payment platforms going forward. Regulatory bodies like the SEC, often refer to cryptocurrencies as a“safe haven” for fraudulent activities. They have associated cryptos with drug sales, child pornography, and other illicit transactions on the Dark Web, or with the funding of terrorism.

"Allowing an address that accepts deposits from, or makes payments or deposits to, disreputable networks is potentially abetting their activity, which creates legal liability for banks, exchanges and traders," said Danny Yang, CTO of DMG Blockchain Solutions.

Bitscore will initially support Bitcoin only, but its roadmap includes the implementation of more Blockchains like Ethereum (in summer 2018), and Litecoin and Bitcoin Cash later this year. Additionally, DMG has a geolocation API in development that will provide data for the source and destination country of Blockchain transactions. It is set to launch in the Fall of 2018.


Disclaimer: information contained herein is provided without considering your personal circumstances, therefore should not be construed as financial advice, investment recommendation or an offer of, or solicitation for, any transactions in cryptocurrencies.