Ethical Edge can track, analyze, and uncover illicit blockchain activities. This includes identifying fraud, money laundering, market manipulation, and other practices within the Web3 space, and often involves working closely with other institutions and agencies to detect suspicious transactions and identify actors. Tracing digital transactions across various cryptocurrency networks requires sophisticated technology, forensic, OSINT, and even HSINT techniques to identify transaction patterns, wallet addresses, and blockchain records to link anonymous activity to real-world individuals and entities.

Digital asset investigations require specialized blockchain forensic tools and traditional investigative methods to track, review, and analyze how a digital wallet was created and how it has been used over time. Throughout this process, forensic specialists study evidence such as transaction IDs, the types of assets (cryptocurrencies) held or transacted, transaction histories, funding sources, account and transaction balances, and in many instances, attribution details. A skilled and careful review of where a transaction originated on the blockchain, such as whether it was initiated on an exchange, can provide a critical trail. 

Beyond merely tracing digital assets, Ethical Edge uses a combination of skills and expertise to assist with your company with compliance advisory services. Businesses that operate in cryptocurrency space must adhere to Know Your Customer (KYC), Anti-Money Laundering (AML), and other best practices to ensure the integrity of the overall financial system and prevent illicit activities such as money laundering, fraud, terrorism financing, and tax evasion. Key areas in which compliance matters may impact a business include but are not limited to:

Preventing Illicit Activities: KYC and AML protocols help crypto platforms identify suspicious activities and customers involved in illegal acts. Without these safeguards, platforms could be exploited for illegal transactions, allowing money laundering, terrorist financing, and other financial crimes to occur undetected. 

Protecting Reputation: Compliance with KYC and AML regulations protects the platform’s reputation by ensuring that it is not inadvertently associated with illegal activities. Non-compliance can lead to significant reputational damage, making it harder to attract legitimate customers and partners. 

Avoiding or Mitigating Legal and Regulatory Risks: Failure to comply with local and international laws exposes platforms to heavy penalties, fines, and potentially even the shutdown of their operations. Regulatory bodies worldwide, including the Financial Action Task Force (FATF) and authorities in individual countries, are increasingly scrutinizing the crypto industry.

Building Trust with Customers: By adhering to these regulations, platforms demonstrate a commitment to creating a secure and trustworthy environment for their users. This increases confidence in the platform and encourages more people to engage with crypto markets safely. 

Enhancing Financial Stability: By identifying and blocking suspicious transactions, platforms contribute to broader financial stability and safeguard against systemic risks. Illicit transactions can destabilize markets and cause long-term damage to the financial ecosystem. International Compliance: Many cryptocurrencies operate globally, meaning they must comply with laws in multiple jurisdictions. Adhering to international standards, such as those set by the FATF, ensures that platforms remain eligible for business in various countries and avoids issues like market shutdowns or legal disputes.

Access to Banking and Payment Services: Financial institutions are often reluctant to work with businesses that do not comply with KYC and AML requirements. This can limit a crypto platform's access to banking and payment services, making it difficult to process customer transactions and grow the business. 

Compliance and due diligence processes can overlap significantly in this regard, as it is essential that your business can verify that a potential partner or target company is current with all applicable KYC, AML, anti-corruption, and other laws, regulations, and best practices, and that the company under scrutiny is not exposed to risk of investigations or sanctions.