Bitcoin ATM operators DigitalMint and Coinsource, along with other leading cash-to-crypto companies, announced the establishment of the Cryptocurrency Compliance Cooperative (CCC). The collaborative association aims to enhance regulations around cryptocurrencies, creating a safer, legitimatized cash-to-cryptocurrency environment for consumers.

The CCC invites all cash-based cryptocurrency MSBs, regulatory bodies, financial institutions, suppliers, non-governmental and law enforcement agencies to join and share best practices, collaborate with industry leaders, and learn about enforcing stricter and more secure compliance protocols. CCC will aim to follow and stay ahead of regulatory updates, standards, research, developments, and trends to prevent fraud and to create an adequate environment for the cash-to-crypto industry.

Seth Sattler, Director of Compliance for DigitalMint and leading contributor of the Cryptocurrency Compliance Cooperative, declared – “The nefarious use cases plaguing this industry are well documented by several law enforcement agencies, and include fraud, elder abuse, and drug and human trafficking. While a small number of Bitcoin ATM operators go above and beyond with know-your-customer (KYC) and anti-money laundering (AML) protocols, others in the cash-to-crypto industry simply turn a blind eye and are complacent to these bad actors by simply applying the bare minimum customer protections, which in many cases allow for completely anonymous transactions.”

The State of New Jersey Commission of Investigation conducted a report evaluating the cash-to-cryptocurrency industry. The report concluded that well over 70% of the BTM operators in the state allowed transactions with as little identification as a cellphone number, or in some cases, no information at all. This unreliable way of confirming identity precludes transaction monitoring.

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“Unfortunately, many BTM operators feel that merely asking for a cell phone number is enough due diligence to absolve them of their mandated KYC requirements.” – said Bo Oney, Executive Vice President of Operations and Head of Compliance at Coinsource. “Such lax provisions provide a safe haven for bad actors to abuse the machines for nefarious purposes. The CCC is seeking to bolster regulatory requirements for the benefit of all BTM users and operators.  This will require input from the most knowledgeable in the industry, all with the goal of making the cash-to-crypto space as safe as possible for consumers.”

“Lax compliance policies and high rates of illicit activity have long plagued the reputation of Bitcoin ATMs.” – said Caitlin Barnett, Director of Regulation & Compliance, Chainalysis. “We are thrilled to support this initiative led by two leaders in the space to build trust in Bitcoin ATMs and promote more financial freedom with less risk.”

Mr. Sattler added – “We must do better. This isn’t just an industry group – this is a movement.  It’s our hope that others heed our call and join this cooperative as we push for enhanced and modernized regulations in the best interest of public safety.”

Initial members of the CCC include:

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• Anti-Human Trafficking Intelligence Initiative
• Chainalysis
• CipgherBlade
• Coinsource
• DigitalMint
• Elliptic
• Halo Privacy
• Maya
• Metropolitan Capital Bank
• Palmera Consulting
• Royal Business Bank
• Surety Bank
• The Knoble
• Titan Bank, N.A.
• Trust Stamp