As the cryptocurrency industry continues to gain traction, Virtual Assets Service Providers (VASPs) play a critical role in shaping the digital financial landscape. However, the industry faces considerable challenges due to illicit activities such as drug trafficking, arms trading, and darknet market involvement. This article examines the risk exposure of top VASPs based on data from three different studies and highlights how Coinfirm Analytics can help you manage these risks effectively.
Risk Exposure in Drug Trafficking
Data from 2022 on the top 10 and 200 VASPs reveals that the Top 10 VASPs have a four times lower risk exposure for inbound transactions related to drug trafficking, and more than seven times lower risk exposure for outbound transactions compared to the Top 200 average. This underscores the importance of choosing reputable VASPs that prioritize risk management and compliance.
Risk Exposure in Weapon Trading
The 2022 data on the Top 10 and 200 VASPs also shows that the Top 10 VASPs have a two times lower risk exposure for inbound transactions related to weapon trafficking and trade, and 4.3 times lower risk exposure for outbound transactions. This further supports the notion that established crypto market players are better equipped to protect themselves against illegal activities.
Risk Exposure in Darknet Market Involvement
By analyzing inbound and outbound transactions from 2022, the study found that the Top 10 VASPs have significantly lower risk exposure to addresses associated with suspicious activities compared to other providers. The risk exposure to addresses related to the darknet market was 3.7 times lower for inbound transactions and more than 6.6 times lower for outbound transactions.
Addressing VASP Risk Exposure
The importance for businesses and individuals involved in the cryptocurrency industry to take proactive measures to minimize risk exposure. Coinfirm Analytics provides a comprehensive risk management solution tailored for institutions, enabling them to closely monitor transactions and wallets, while analyzing and verifying risk using the world’s largest blockchain attributes database. By integrating Coinfirm Analytics into your risk management strategy, you’ll be empowered to make well-informed decisions, paving the way for effective risk management within the blockchain ecosystem.