The cryptocurrency brokerage Robinhood Crypto has partnered with blockchain data platform Chainalysis to provide compliance services and more to its customers.
Chainalysis offers data, software, services, and research to over 60 organizations around the world, including government agencies, exchanges, financial institutions, insurance companies, and cybersecurity firms.
Robinhood Crypto will be using two pieces of software called Chainalysis KYT and Chainalysis Reactor. Chainalysis KYT will help the company flag “risky and illicit transactions in real-time, while Chainalysis Reactor enables deeper due diligence into suspicious activity.”
Ben Einstein, head of partnerships at Robinhood Crypto, said 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.”
The announcement coincides with Robinhood’s upcoming launch of Robinhood crypto wallets, which will allow users to deposit and withdraw bitcoin, Ethereum, Dogecoin, and more, as well as connecting Robinhood Crypto customers to the blockchain.
The company began allowing cryptocurrency trading in 2018 and announced the new cryptowallet feature in September. According to Robinhood, there are more than 1.6 million people on the waitlist for crypto wallets.
Robinhood said in regulatory filings that 17% of its revenue in the first quarter of 2021 came from cryptocurrency trading. According to CNBC, more than half of Robinhood’s transaction-based revenue came from cryptocurrency trading last quarter.
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