Understanding Cryptocurrency Compliance | ACAMS Insights

Why the tape matters—and what to do

Scenario

Imagine you're running a small online store that accepts cryptocurrency payments. You've noticed an uptick in transactions, and while it’s exciting, you're also aware of the potential legal and compliance challenges that come with it.

• Understanding and adhering to cryptocurrency compliance regulations is crucial for businesses accepting digital currencies.
• Regulatory bodies worldwide are increasingly focusing on the anti-money laundering (AML) and know your customer (KYC) requirements for crypto transactions.
• Cryptocurrency exchanges and businesses must implement robust systems to ensure they comply with these regulations.
• The failure to comply can lead to hefty fines, reputational damage, and even legal action.
• Staying updated with evolving crypto laws is essential to protect your business from potential risks.
• Collaboration with financial institutions and regulatory authorities can help ensure smooth compliance processes.

Examples

An example of a compliant cryptocurrency business is Binance, which has stringent KYC policies in place. They require users to verify their identities before they can access certain services or withdraw funds. This includes uploading government-issued ID documents and proof of address.

Question

How often should I update my compliance measures?

Regularly reviewing and updating your compliance measures is crucial. Given the dynamic nature of cryptocurrency regulations, it’s advisable to review them at least once a year or after significant changes in the regulatory landscape.

Risk management you can actually use

• Risk per trade = account equity × risk% (e.g., 1%).
• Position size = risk per trade ÷ (entry − stop).
• Expectancy (E) = win_rate × avg_win − (1−win_rate) × avg_loss.
• Cap total portfolio risk; journal every trade.

A quick example

Account $10,000, risk 1% → $100 risk per trade. Entry $50, stop $48 → $2 risk/share → 50 shares. Target $54 (2R). If stopped, −$100; if target hits, +$200 (before costs).

How much capital do I need to start?

Use an amount you can afford to lose while learning a repeatable process.

How do I size positions?

Decide a fixed risk % per trade, then divide by the price distance to your stop.

How often should I review?

Match your timeframe: DAIly/weekly for swing; weekly/monthly for long-term.

What goes into my journal?

Thesis, entry/exit, risk (R), emotions, result, next improvement.

Sources & Signals (add before publish)

• Earnings or guidance: …
• MaCRO data or policy: …
• Sector flows: …
• Unusual volume/price action: …