Crypto exchange Coinbase is advocating for the US government to use modern technology like blockchain analytics and AI to combat financial crime in the crypto space. They argue that these tools can help identify and deter illicit activity, aligning with the Anti-Money Laundering Act of 2020. Regulatory clarity for AI and APIs is key in the fight against financial crime, according to Coinbase’s chief legal officer Paul Grewal. He believes that companies using these tools should have a safe harbor under the Bank Secrecy Act. Grewal also emphasizes the need for clearer rules around blockchain technology, decentralized IDs, and zero-knowledge proofs for customer verification and AML compliance. The US Treasury recently requested comments on innovative methods to detect illicit activity involving digital assets, as required by the GENIUS Act. Think tank American Enterprise Institute suggests establishing a communication system where law enforcement agencies can directly query crypto firms for investigative purposes, potentially improving law enforcement capabilities while reducing the financial surveillance burden.

Read more at Cointelegraph: Coinbase Urges US to Use AI and Blockchain to Fight Crypto Crime