Binance Custody taps TRM Labs for regulatory compliance and risk management

Rick Steves

“As an institutional custodian, our utmost priority is to provide secure and compliant services that our clients can trust. Utilizing TRM’s compliance and risk management solutions strengthens our suite of secure custody solutions to help clients safely participate in this rapidly growing digital economy.”

binance

Binance Custody has deployed the risk management tools from TRM Labs in order to ensure its regulatory compliance and risk management program for client holdings.

Binance Custody is the institutional-grade digital asset custody solution offered by the world’s largest cryptocurrency exchange, Binance, and was launched in December 2021.

The crypto custodian has already secured its specie insurance, ISO 27001 & ISO 27701 certifications and SOC 2 Type 1 attestation, and is currently pursuing its SOC 2 Type 2 attestation.

The certifications ensure the platform offers high security and integrated access to deep institutional liquidity venues with compliant, insured, and audited technology solutions.

Binance Custody was launched to address concerns that security and custodial services remain a significant hurdle to broader institutional participation in the space.

The partnership with TRM Labs will only reinforce its position within the digital asset space.

Suite of compliance and risk mitigation tools

Binance Custody will leverage TRM to better manage regulatory and reputational risk related to digital assets by accessing its asset coverage, risk assessment, and forensics technology capabilities.

Athena Yu, EVP of Binance Custody, commented: “As an institutional custodian, our utmost priority is to provide secure and compliant services that our clients can trust. Utilizing TRM’s compliance and risk management solutions strengthens our suite of secure custody solutions to help clients safely participate in this rapidly growing digital economy.”

Binance Custody uses TRM to screen for high-risk wallets, and monitor and investigate suspicious transactions. The suite of tools complies with AML/CFT regulatory requirements and manages exposure to risks such as sanctions, hacked or stolen funds and terrorist financing.

The TRM tool suite includes:

  • Transaction Monitoring: Real-time risk scoring of cryptocurrency transactions for AML compliance, sometimes known as Know-Your-Transaction or KYT.
  • Wallet Screening: Proactive screening of cryptocurrency addresses for sanctions and AML compliance.
  • VASP Due Diligence: Comprehensive on-chain risk profiles of “Virtual Asset Service Providers” (VASPs) and other digital asset businesses.
  • Forensics: Investigative tools to trace the source and destination of funds and link high-risk addresses to real-world entities.

Esteban Castaño, co-founder and CEO of TRM Labs, said: “As mainstream adoption of digital assets progresses, it is vital that institutions have compliance peace-of-mind when choosing partners such as custody service providers. By incorporating TRM’s suite of compliance and risk mitigation tools, Binance Custody reinforces its ambition to deliver innovative services with trust and safety at the forefront.”

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