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CipherTrace Crypto Advisory | Payments Giants Embrace ETH & BTC

FinCEN’s New Acting Director Visa and PayPal Move Forward with Crypto Plans | Russia Monitoring Crypto-to-Fiat Half a Billion Dollars in Fines Levied Against Fraudulent BTC Trader | Gensler Nom Advances


  • Watch Unconfirmed to Understand FATF’s Latest Guidance
  • FinCEN Director Blanco Steps Down
  • Visa Takes First Steps for Crypto Adoption on Ethereum Blockchain
  • Paying with PayPal? You Can Now Use Crypto
  • Russia Begins Monitoring of Crypto-to-Fiat Transactions
  • UK Man Ordered to Pay More Than $571M for Fraudulent Bitcoin Trading Scheme
  • Crypto-Friendly Gensler Senate Nomination Set to Advance
  • Quick Hits: FCA Reveals New Reporting Policies, Koine’s Lack of Coin, Ransomware “Running Wild”


New: Catch Dave on Unconfirmed

Dave sat down with Laura Shin to discuss the latest FATF guidelines and how they affect DeFi, NFTs and expands coverage to apply to most virtual asset entities. Watch:


FinCEN Announces New Acting Director

On April 2, the Financial Crimes Enforcement Network (FinCEN) announced that Director Kenneth Blanco will depart the US AML watchdog on April 9. Former FinCEN Deputy Director Michael Mosier will serve as Acting Director effective April 11, 2021. AnnaLou Tirol, former Associate Director of FinCEN’s Strategic Operations Division, will now serve as Deputy Director.

Why it matters: Mosier’s background in blockchain analytics will result in data driven decision making as the new US administration determines cryptocurrency policies and codifies cryptocurrency anti-money laundering laws with full knowledge of distributed ledger technology.

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Visa Processes First Payment Directly on the Ethereum Blockchain

Enacting the first phase of their full cryptocurrency rollout plan, Visa announced that they have officially processed their first transaction on Ethereum. Together with, a USDC stablecoin was sent to an address under the payment giant’s name. This solidifies Visa’s position as the most progressive payment merchant in terms of cryptocurrency, adding to their expanding list of crypto-related products and partnerships and allowing crypto platforms like to pay them with USDC rather than traditional fiat.

Why it matters: Visa is one of the largest payment processors in the world, and their willingness to leverage the advantages of cryptocurrency should be seen as a huge sign of confidence for the future of the crypto economy. This also begins to address a major roadblock facing cryptocurrency adoption: spending it. With their size, reputation and technology, Visa is wielding its influence to significantly impact the crypto space.

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PayPal Announces Crypto Checkout Service

On March 30, PayPal made bitcoin payments available to its U.S. customers, a step that could prompt many of its users to embrace cryptocurrency. “This is the first time you can seamlessly use cryptocurrencies in the same way as a credit card or a debit card inside your PayPal wallet,” PayPal CEO Dan Schulman told Reuters.

PayPal will settle transactions using bitcoin in fiat currency, which will shield merchants from the token’s volatility. Schulman told Reuters that he hopes the move will help bitcoin transition from an asset to a real-world transactional tool.

Why it matters: Paired with the news from Visa, there can be little doubt that 2021 is the year of mainstream cryptocurrency adoption. It took twelve years for bitcoin to reach this point, but as the public grows more accustomed to the idea of cryptocurrency, newer blockchain applications like DeFi and NFTs may see their way to mainstream legitimacy smoothed.

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Russian Anti-Money Laundering Body to Monitor Crypto-to-Fiat Transactions

During a March 23 meeting of the State Duma Committee on the Financial Market, Deputy Head of Russia’s Federal Financial Monitoring Service (Rosfinmonitoring) Herman Neglyad announced that the AML body has begun monitoring crypto-to-fiat transactions. Based on Neglyad’s statements, it appears Rosfinmonitoring is collecting data from Russian banks, which are monitoring for transactions to and from virtual asset service providers (VASPs) and reporting these transactions to the Federal Financial Monitoring Service.

Why it matters: As more mainstream consumer and institutional investors embrace cryptocurrencies, it becomes increasingly difficult, if not impossible, for traditional financial institutions to avoid entanglements with the crypto economy. As such, it’s important for banks to understand how best to detect and monitor transactions to and from VASPs. CipherTrace research has found that a typical name-based monitoring system may entirely miss up to 70% or more of the crypto exchanges out there, and up to 90% of the actual transaction volume. For best practices for monitoring virtual currency-related transactions at your bank, be sure to check out our blog:

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UK Bitcoin Scammer Fined $571 Million

After defrauding over 1,000 individuals of over 22,000 bitcoin (valued at about $143 million at the time), the US District Court for the Southern District of New York entered a default judgement against a UK man at the heart of the scheme.

According to the Commodity Futures Trading Commission, Benjamin Reynolds of Manchester was found guilty of defrauding and misleading members of the public on social media is required to pay $143 million in restitution as well as $429 million in civil penalties. He is also barred from conduct that violates the Commodity Exchange Act and CFTC regulations, and also cannot trade in any CFTC regulated markets or register with the CFTC.

Why it matters: Given the ease with which social media can be leveraged as a tool by bad actors, it is incumbent upon users to be especially vigilant of scams. It’s always a good practice to check to make sure the company is registered and licensed to operate in your jurisdiction. It’s easier to keep your cryptocurrency safe than to retrieve it from a scammer.

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Cryptocurrency Ally Gary Gensler Advances to Senate Review 

On April 12, the United States Senate is expected to review a number of nominations coming from the Biden Administration, including Gary Gensler. Gensler was chosen by Biden to lead the SEC, filling the role for the remainder of the term after the position was left open by previous SEC chairman Jay Clayton.

Why it matters: Gary Gensler’s crypto-positive views could be a catalyst for change when it comes to regulations supporting innovation and the rise of new crypto businesses in the United States. When asked about regulations, he replied, “As cryptocurrency technology evolves, it’s important to stay true to our principles of investor protection and at the same time, be technology neutral.”

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UK Crypto Companies Face New Reporting Requirements

The UK’s Financial Conduct Authority (FCA) added crypto companies to the list of firm types required to submit financial crimes reporting. The new policy nearly triples the number of firms required to report annually to the FCA, and was characterized as a response to money-laundering threats.

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Full policy:


Koine Goes Bust, Offers Tech Stack for Sale

Crypto custody platform Koine was pushed into insolvency earlier this year as investment commitments of approximately £15 million fell through in January, CoinDesk reported. The London-based firm returned client funds; the future of the platform is unclear. Custody is a complex technology problem and as mainstream crypto adoption continues to accelerate it will be a critical part of the blockchain economy.

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Former DHS Official Warns Crypto Ransomware “Running Wild”

In an appearance on Late Night with Bill Maher, former DHS official Christopher Krebs warned that ransomware attacks demanding cryptocurrency have become so widespread that the average American is now concerned with the threat. Schools, hospitals, and government agencies have all fallen victim in recent years. Krebs called for more government oversight and more stringent consequences for “bad guys” to curb the problem.

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