Blockchain analytics and AI for crypto AML, paired with API-driven monitoring, are essential tools to curb crypto crime. Coinbase urges the US Treasury to promote their use, proposing governance-focused safe harbors under the Bank Secrecy Act to boost monitoring, interoperability, and enforcement while protecting privacy.
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Governance-focused safe harbors under the Bank Secrecy Act would clarify acceptable AI and API use in AML
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Standardized data practices and privacy protections are needed to boost confidence for crypto firms to adopt these tools
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Support for decentralized IDs and zero-knowledge proofs could improve customer verification while safeguarding privacy
description: Blockchain analytics and AI for crypto AML are central to Coinbase’s plea for Treasury action—discover governance-focused rules designed to unlock safer, smarter enforcement.
What is blockchain analytics and AI adoption for crypto AML?
Blockchain analytics and AI-driven monitoring are increasingly viewed as essential components in enforcing anti-money laundering rules within the crypto sector. This article examines Coinbase’s call for urgent policy action, the Treasury’s responses to the GENIUS Act directive, and the potential pathway toward governance-based, outcomes-focused guidelines that could harmonize innovation with enforcement. The emphasis is on applying data analytics and automation to trace illicit activity while preserving privacy and competitive integrity.
How can AI and APIs improve AML in crypto?
Artificial intelligence and API-based monitoring can enhance transaction screening, clustering of related addresses, and automated risk assessment across platforms. By outlining clear governance criteria and interoperability standards, policymakers can reduce regulatory ambiguity, empower exchanges to deploy robust tools, and enable faster detection of suspicious activity without imposing one-size-fits-all mandates. The aim is to align technological adoption with the core objectives of existing anti-money laundering statutes.
Frequently Asked Questions
What is Coinbase’s position on using AI and APIs for AML in the crypto industry?
Coinbase argues that AI and API-driven analytics should be encouraged within a clear regulatory framework. The position emphasizes governance and outcomes over rigid, universal requirements, urging the Treasury to establish a safe harbor under the Bank Secrecy Act for firms employing these technologies. The goal is to improve detection capabilities, data interoperability, and enforcement effectiveness while safeguarding privacy and data governance.
How will Treasury guidelines affect crypto firms adopting blockchain analytics?
The Treasury’s guidance could either accelerate or hinder adoption depending on whether it provides clear, flexible rules that recognize diverse business models. Support for decentralized identifiers and zero-knowledge proofs is proposed as legitimate verification methods alongside traditional analytics, with an emphasis on practical data-sharing guidelines that protect consumers and enable efficient investigations.
Key Takeaways
- Clear, governance-based guidelines: A risk- and outcome-focused framework can reduce ambiguity for AI and API-driven AML tools.
- Interoperability and privacy: Standardized data practices and privacy protections are essential to unlock broad adoption across firms and jurisdictions.
- Advanced verification tools: Decentralized IDs and zero-knowledge proofs are being discussed as part of compliant customer verification and privacy-preserving analytics.
Conclusion
Coinbase’s appeal centers on modernizing crypto AML through blockchain analytics, AI, and APIs within a clear regulatory envelope. By proposing governance-focused safe harbors and outcome-based standards, the industry can pursue more effective enforcement while preserving privacy and innovation. As the Treasury weighs these proposals, the path forward will hinge on balanced guidelines that foster responsible adoption and robust public safeguards.
Publication date: October 2025 • Updated: November 2025
Author: COINOTAG
Sources and context (mentioned in plain text)
Public notices and statements referenced include the U.S. Treasury’s GENIUS Act-related outreach and Coinbase’s public remarks by its Chief Legal Officer, with commentary from policy leaders about AI, APIs, digital IDs, and zero-knowledge proofs. Notable organizations cited in discussion include the American Enterprise Institute and various policy discussions around the Bank Secrecy Act and related AML frameworks. All source mentions are provided here as plain text rather than live links to preserve self-containment.
