Key takeaway: Five crypto crime typologies account for a significant chunk of the digital asset risk a financial institution (FI) is likely to encounter. Each typology intersects with an FI’s existing compliance obligations, and each one is detectable with the right on-chain visibility. Understanding what those risks are is the starting point for building a framework to manage them.

Financial institutions (FIs) already run mature programs to manage familiar financial crime risks like money laundering, sanctions evasion and fraud.

Digital assets don’t change the nature of those risks, but they change the infrastructure the risks move through. Funds can cross multiple blockchains through bridges and decentralized services in minutes,…