Chainalysis announces sanctions screening tools free of charge amid war
Each will use the same data to confirm whether or not the address is on economic/trade embargo lists, such as those of the US, EU, or UN, with which anyone subject to those jurisdictions is prohibited from dealing.
Chainalysis has accelerated the launch of two sanctions screening tools for the cryptocurrency industry free of charge amid recent events taking place in Ukraine.
Countries around the world continue to leverage economic sanctions in response to Russia’s invasion of Ukraine. Chainalysis want to do their part by helping decentralized web3 groups like DEXs, DeFi platforms, DAOs, and DApp developers and their customers to comply with sanctions policies.
The tools enable users to easily validate they are not interacting with cryptocurrency wallets associated with sanctioned entities.
Helping decentralized platforms comply with sanctions policies
Chainalysis states that the transparency of blockchains makes it difficult for the Russian government or financial elite to systematically evade sanctions at scale through cryptocurrency without detection.
As sanctioned Russian actors are expected to use cryptocurrency as a means to evade sanctions, all of these transactions would be permanently recorded on the blockchain, providing opportunities to identify and shut down sanctions evasion tactics.
Michael Gronager, Co-Founder and CEO, Chainalysis, said: “Now is the time for the industry to demonstrate that blockchains’ inherent transparency make cryptocurrency a powerful deterrent to sanctions evasion. In anticipation of ongoing sanctions, we’ve prioritized the development of these tools so that all cryptocurrency market participants have what they need to harness this transparency and conduct basic sanctions screening at no cost to them.”
Corbin Page, Founder of Paymagic, commented: “Until now, we haven’t been able to find an easy way to monitor sanctions risk. There were no data sources. Chainalysis’ tools will give us the information we need and peace of mind to focus on building our products while preventing exposure to sanctioned entities. This is more important than ever in today’s Web3 world.”
Most centralized exchanges use transaction monitoring products like Chainalysis KYT, which provides much more extensive data and capabilities.
Many decentralized protocols and platforms, however, do not incorporate tools that allow for effective management of sanctions risk.
These new Chainalysis offerings will provide an easy way to conduct basic sanctions checks to help manage reputational and sanctions enforcement risk.
The Chainalysis oracle and API will provide any cryptocurrency business, protocol, or organization a simple way to quickly check if an address is on a sanctions list before allowing it to connect with their service.
Each will use the same data to confirm whether or not the address is on economic/trade embargo lists, such as those of the US, EU, or UN, with which anyone subject to those jurisdictions is prohibited from dealing.
The Chainalysis oracle is a smart contract that can be called from other smart contracts to validate a wallet before allowing an interaction with the second contract.
