When an established company considers holding crypto, the compliance questions usually come first. Is the activity permissible? Is the exchange or custodian acceptable? Have the wallets been screened? Are AML and sanctions controls adequate?

Those questions can all have satisfactory answers while the transaction still produces an outcome the institution did not intend.

The reason is that compliance, treasury, finance and risk may all be looking at the same crypto asset but measuring different things. Treasury may see a liquid reserve asset. Finance may see an intangible asset. Risk may see volatility or covenant exposure. Compliance may see an approved counterparty and permissible transaction.

None of…