Reported by Ari Redbord

A recent tweet by venture capitalist and Coinbase board member Kathryn Haun, responding to Senator Elizabeth Warren’s AML bill, called out the ineffectiveness of AML in traditional finance. Haun, a former federal prosecutor, wrote: “We need something better. Senators that genuinely care about national security will work collaboratively with TradFi and crypto to fix *that* problem rather than beating up on the most auditable payments infrastructure ever invented.”

What Haun is describing is the way the unique and native qualities of public blockchains – transparent, traceable, immutable – allow for better and more effective AML compliance.

In a recent interview with Ari Redbord, Jai Ramaswamy, former head of the Department of Justice’s anti-money laundering unit, echoed this sentiment, explaining that “the native properties of the blockchain actually lend themselves to appropriate regulatory and financial investigation capabilities.”

Blockchain transactions are, by default, public information as opposed to data owned by siloed financial institutions. Ramaswamy, currently the Chief Legal Officer at Andreessen Horowitz, went on to explain that the nature of blockchains allow law enforcement and regulators to police illicit activity in ways impossible in the traditional world, including following the flow of funds across jurisdictions with greater speed.

Unlike traditional financial crime investigations in which transactions are often difficult to follow across borders, through networks of shell companies, or between siloed financial institutions, investigations on the blockchain utilize real time data and enable a birds-eye view of the entire chain of financial flows even if the transaction is several years old.

Read full report: https://www.forbes.com/sites/digital-assets/2023/08/04/what-congress-can-learn-from-razzlekhan-about-crypto-aml/amp/