IHS Markit's Compliance Solutions for Crypto Providers

With the growing adoption of cryptocurrencies and crypto-based assets, the crypto ecosystem and its participants are coming under greater scrutiny from regulators, political authorities, and the public at large. There are growing calls to oversee the crypto industry to ensure it does not become a conduit for money launderers and financial criminals to exploit this ecosystem for nefarious gains. Regulators and supervisory agencies are responding by updating current rules and proposing new ones.

These changes are prompting participants in the nascent but burgeoning crypto ecosystem to strengthen—and in many cases implement for the first time—policies, frameworks, processes, and technology to comply with the new regulatory requirements. IHS Markit, a provider of middle and back office technology and operations for capital markets institutions with a strong focus on risk and compliance functions, has augmented its existing capabilities with new investments and partnerships with other vendors to come up with a new offering—Regulatory Compliance & Due Diligence—specifically targeted at the players in the crypto industry.

Key differentiators for IHS Markit are its ability to provide full life cycle support across KYC, tax, third party risk management, and broader onboarding and compliance functions as well as its wide suite of offerings including data, technology, and managed services. Its global scale, long history, and demonstrated expertise in serving capital markets firms should position it well to serve crypto players. The crypto industry is still in its infancy. Recent developments involving some of its players have raised questions about the long-term viability of this industry, which could present a challenge in defining the gold-standard for digital asset compliance adherence and managing the complexity of a cross-border digital asset for IHS Markit’s new offering.