Chainalysis helps Robinhood in meeting compliance requirements

Robinhood will be partnering with crypto tracing firm Chainalysis to get data and tools for trading in advance of the app launching its crypto wallet. The trading app will adopt Chainalysis’ monitoring compliance solution Know Your Transaction and the Chainalysis Reactor, its investigations software, to meet compliance requirements.

On Monday, Chainalysis announced the integrated partnership with Robinhood Crypto will help the trading app meet compliance requirements ahead of the launch of its crypto wallet, expected to roll out for all users in early 2022.

According to Robinhood, the platform will adopt Chainalysis’ Know Your Transaction, the firm’s monitoring compliance solution, in addition to Chainalysis Reactor, its investigations software. The trading app also said its teams would use Chainalysis’ certification programs to achieve compliance.

“Chainalysis works closely with regulators and law enforcement to develop industry best practices, and that approach is aligned with Robinhood’s commitment to working with policymakers in a collaborative manner,” said Ben Einstein, Robinhood Crypto head of partnerships.

Robinhood revealed that more than 1.6 million people are on the waitlist for a wallet, which will support depositing and withdrawing Bitcoin (BTC), Ether (ETH), Dogecoin (DOGE), and other tokens. Since its first announcement in September, the trading app has been testing its digital wallet feature.

Numerous government agencies and companies in the private sector employ Chainalysis as a solution to track both legitimate and illicit crypto transactions. For example, when the United States Department of the Treasury announced it would impose sanctions on the Czech and Russia-based business Suex OTC, it cited an investigation from the analytics firm.

In September, Robinhood said it is testing a new feature on its app that would enable users to trade and store cryptocurrency in digital wallets, according to Bloomberg. Though the official release won’t come until 2022, in October, the waitlist for Robinhood’s crypto wallet had reached more than one million customers long, as CEO Vlad Tenev told CNBC.