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CipherTrace announces intention to help central banks build digital currencies that emphasize privacy and compliance

The rise of company-issued or government-backed digital currenciesincluding Libra and the digital Yuanhas created a sense of urgency among many nations to develop their own Central Bank Digital Currencies (CBDCs). Until today, most work by central banks and independent organizations has been focused on the concept of CBDCs rather than the implementation. Thirty-eight countries in addition to the European Union are now piloting or considering CBDC solutions. In fact, it’s estimated that 10% of all central banks will either implement or start developing CBDCs in the next few years.  

However, for a CBDC to succeed, CipherTrace believes it must exhibit several characteristics, including: 

  • Ease of use for non-technical users and existing payment infrastructures 
  • Reliability and availability at scale 
  • Integrity, whether via a distributed ledger, central bank, or hybrid approach 
  • Compliance with anti-money laundering (AML) requirements and cross-border controls 
  • Data protection and security in transit and at rest 
  • Privacy controls, such as selective disclosure for consumers 

CipherTrace will take the next major step towards the actualization of CBDCs by working with central banks to implement their solutions in a manner that prevents money laundering and protects personal privacy. As an industry-leading cryptocurrency intelligence firmCipherTrace is uniquely suited to lead this initiative to build private, secure, and AML-compliant CBDCs. This is the first CBDC initiative in the world with a focus on compliance and privacy. 

As the world’s leading blockchain analytics firm, we are well-equipped to deliver on a CBDC solution that is scalable, compliant, and incorporates adequate privacy controls, including selective disclosure for consumers. Our CBDC initiative builds on our strong existing relationships with the government groups and departments needed to make real progress on CBDC applications; in the U.S., for example, CipherTrace has briefed the highest echelons of the US Treasury, OCC, SEC and CFTC. Our quarterly Cryptocurrency AML Reports have been instrumental in informing financial institutions and regulators worldwide on the evolving compliance needs sparked by cryptocurrencies, and the company is recognized as a privacy advocate for its collaboration on privacy coins. 

“As the digital economy becomes increasingly synonymous with the global economy, the need to modernize our financial system is that much more palpable,” said Dave Jevans, CEO and a founder of CipherTrace. “Due to the accessibility and efficiency enabled by transacting in digital currencies, it’s only a matter of time before every country will be developing a CBDC. We want to ensure that these currencies are private, secure and compliant so that the transition to CBDCs is seamless for governments, banks, businesses, and individuals.” 

The inevitability of the digital revolution underlines the need for countries to adapt to CBDCs, a need that is further underscored by the current COVID-19 pandemic and the need for a sanitary alternative to traditional paper-and-metal currencies. However, going digital should never involve sacrificing privacy or security, which is why CipherTrace is committed to helping implement the first highly secure, privacy-focused, and AML-compliant CBDC. 


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