Crypto Exchange Circle Partners With Financial Surveillance Provider Nice Actimize

On Feb. 27, Boston-based cryptocurrency finance firm Circle announced a partnership with Nice Actimize financial crime detection and prevention technologies unit. Circle follows other large cryptocurrency exchanges that have opted to add a compliance and surveillance solution.

Also read: Bitcoin Whales Have Accumulated Thousands of Coins in the Last 2 Months

Goldman Sachs-Backed Crypto Exchange Partners With Compliance and Surveillance Unit

Circle believes there is a need for regulation in the crypto market ecosystem so the Goldman Sachs-backed firm has decided to partner with a compliance and surveillance entity called Nice Actimize. The financial crime, risk and compliance solutions manager Nice is one of the largest service providers to government regulators and financial institutions. Circle explains in its press release that the company selected the Nice Cloud Markets Surveillance (MS) solution in order to fight against market manipulation. The firm wants its $3 billion in monthly trading protected from fraudulent schemes like pump n’ dumps, insider trading, and layering.

The Nice MS solution claims to give companies the ability to track and detect sophisticated forms of market manipulation, the firm details. According to the company, the tools help alert system managers to “all significant threats to crypto trading.” In addition, the system removes false positives in the market by giving exchanges the capacity to tailor alerts to their clients’ trading activity.

“As a leading crypto finance company, it was important that we work with a leading financial crime solutions provider like Nice Actimize which provides industry-leading solutions for the rapidly changing financial crime, risk and compliance landscape,” explained Robert Bench, Circle’s lead regulatory counsel and chief compliance officer.

Bench continued:

Circle has adopted a strong position on policy and crypto-related regulatory issues that focus on the safety of our customers and investors.

The Nice Actimize dashboard. “The Blotter presents flags for transactions with specific open alert types, and automatically takes the user to those alerts with just one click, allowing supervisors to electronically review and sign off on the daily trades for their business unit or trading desk, for example,” explains Nice Actimize.

Circle Joins Other Large Crypto Exchanges Adopting Surveillance Solutions

The news from Circle follows the recent and controversial Coinbase acquisition of surveillance company Neutrino revealed on Feb. 19. The Milan, Italy-based startup Neutrino has worked with various cryptocurrency organizations and global law enforcement in the past. However, there have been reports of unethical activity tied to the firm’s executives and many well known crypto luminaries have spoken out against the acquisition. Neutrino’s founders were previously part of a project called Hacking Team which sold spyware tools to government agencies in order to help silence whistleblowers and journalists. Coinbase is aware of the accusation and has responded to various crypto journalists about the situation.

“Coinbase does not condone nor will it defend the actions of Hacking Team,” explained the official email response to reporters asking about the Neutrino acquisition.

Last year, one of the largest cryptocurrency exchanges in the world by trade volume, Binance, also revealed partnerships with two compliance companies. Back in October 2018, the Malta-based exchange announced it was partnering with the blockchain forensic specialists Chainalysis. A month later Binance CFO Wei Zhou also revealed the company was integrating with Know Your Customer (KYC) verification provider Refinitiv.

A few of the world’s largest exchanges are partnering with compliance and surveillance providers.

Adding Traditional Elements to the Nascent Crypto Market

Circle’s decision to leverage Nice Actimize’s MS solution is based on the company’s experience with providing “proven analytic capabilities.” According to Nice, the company’s MS system utilizes a protocol called Actone, an “AI-enabled financial crime investigation management platform that serves as the next generation alert and case management platform.” Additionally, the partnership with Nice will likely extend to Circle’s subsidiary exchange Poloniex, another leading cryptocurrency trading platform by volume. The head of compliance at Circle says that traditional markets already have a robust anti-manipulation system and market surveillance options and they aim to add similar features to cryptocurrency markets.

“There are a number of market surveillance vendors that address traditional asset classes, but we needed a partner that could adapt their traditional market expertise to the unique elements of the crypto market — Nice Actimize was chosen as the partner which could offer that adaptability,” Bench concluded.

What do you think about Circle partnering with Nice in order to strategically fight market manipulation? What do you think about companies like Coinbase, Circle, and Binance working with third-party compliance and surveillance firms? Let us know what you think about this subject in the comments section below.

Image credits: Shutterstock, Pixabay, Bitcoin.com, Circle, and Nice Actimize.

Need to calculate your bitcoin holdings? Check our tools section.