Cryptoasset Anti-Financial Crime Specialist (CCAS) Certification Practice Test

To comply with regulatory expectations, a bank must send transaction originator information to which types of counterparties?

1. Cryptocurrency exchanges.

2. Unhosted wallet address holders.

3. DeFi applications.

4. Other banks.

The correct answer is: Cryptocurrency exchanges.

In the context of compliance with regulatory expectations, especially related to anti-money laundering (AML) and combating the financing of terrorism (CFT), transactions involving cryptocurrency exchanges are particularly significant. When financial institutions process transactions that involve sending funds to or receiving funds from cryptocurrency exchanges, they must ensure that they maintain transparency and document the originator of those transactions. Sending transaction originator information to cryptocurrency exchanges is important because these exchanges are often gateways to larger crypto markets where anonymity can pose a risk for illicit transactions. Regulatory bodies require banks to collect and share information to enable the tracing of transactions and to help ensure that funds are not being used for illegal activities. This process helps prevent the use of these exchanges as conduits for money laundering or other financial crimes. Conversely, while interactions with unhosted wallet addresses and DeFi applications (decentralized finance) are increasingly under scrutiny, the regulatory framework may not require the same level of transaction originator information sharing as with exchanges, primarily due to the lack of centralized control. Similarly, interbank transactions are generally subject to different regulatory protocols compared to those involving cryptocurrency exchanges, and it may not be specifically mandated to send originator information in those cases. Thus, compliance with regulatory expectations necessitates that banks transmit transaction origin