Cryptocurrency scams hit a record $9.9 billion in 2024, with frauds like Ponzi schemes affecting consumer confidence. Criminals launder fraud proceeds through the crypto sector, challenging firms with weak AML controls. Industry efforts to combat fraud, like scam flagging tools, need cross-sector data sharing for effectiveness.

The crypto industry faces a need for stronger anti-financial crime data sharing to combat fraud. Public-private data sharing is essential in the fight against global fraud, with industry-led schemes in Singapore, Australia, and the UK showing promise. Including the digital assets community in data-sharing efforts will strengthen the ecosystem.

To fight crypto-linked fraud effectively, the industry must focus on data sharing at key points like crypto-to-fiat exchanges. AML challenges arise from fraud laundering through crypto, requiring better data flows and collaboration. Compliance with fraud prevention standards needs to improve with insights from other sectors.

The UK’s policy environment supports cross-sector data sharing to prevent fraud, with legislative changes promoting crime prevention as a legitimate interest. Future digital asset regulation in the UK will likely include consumer protection rules and data sharing requirements. The Financial Conduct Authority sees data sharing as crucial in fighting fraud.

Read more at Cointelegraph: Data Sharing Is The Next Crypto Compliance Frontier