Bitfinex now using compliance tool from Chainalysis to keep ‘bad actors off’ its platform

Cryptocurrency exchange Bitfinex has integrated a compliance tool from blockchain analysis firm Chainalysis to monitor cryptocurrency transactions in “real-time.”

Announced Thursday, Chainalysis said its “Know Your Transaction (KYT)” compliance software will help Bitfinex monitor large volumes of cryptocurrency activity and identify high-risk transactions on a continuous basis. This, in turn, will help the exchange to focus on the most urgent activity and enforce compliance policies.

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Chainalysis’ solution “aligned with what we were seeking to keep bad actors off of our platform, while protecting the privacy of our users," said Peter Warrack, chief compliance officer of Bitfinex. He added that the solution “does not share information identifying users, which is kept strictly in-house.”

Chainalysis currently tracks 41 cryptocurrencies and stablecoins, including bitcoin (BTC), ether (ETH), bitcoin cash (BCH), Tether (USDT), Maker and Dai. It is expected to add support for XRP and several other coins in the near future. 

Bitfinex joins Binance and Bittrex exchanges who recently began using Chainalysis’ KYT software to monitor suspicious transactions. Founded in 2014, Chainalysis provides compliance tools to banks, businesses, and governments. Its top clients include Barclays, the U.S. Securities and Exchange Commission, and EU law enforcement agency Europol, among others.

Last month, Chainalysis cut its workforce by about 20% (laying off 39 employees) to be on the "path to profitability."

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Yogita Khatri is a senior reporter at The Block, covering all things crypto. As one of the earliest team members, Yogita has played a pivotal role in breaking numerous stories, exclusives and scoops. With nearly 3,000 articles under her belt, Yogita holds the records as The Block's most-published and most-read author of all time. Prior to joining The Block, Yogita worked at crypto publication CoinDesk and The Economic Times, where she wrote on personal finance. To contact her, email: [email protected]. For her latest work, follow her on X @Yogita_Khatri5.