1. What Is Money Laundering? Money laundering is the process by which criminals transform illegally obtained funds (such as those from financial fraud, drug trafficking, terrorism, etc.) into clean,1. What Is Money Laundering? Money laundering is the process by which criminals transform illegally obtained funds (such as those from financial fraud, drug trafficking, terrorism, etc.) into clean,
Learn/Cryptocurrency Knowledge/Security Knowledge/What is Ant...Laundering?

What is Anti-Money Laundering?

Jul 16, 2025MEXC
0m
#Basic#Beginners#Basic Concepts
Ethereum Classic
ETC$11.9-1.40%
Gravity
G$0.004348-0.82%
Notcoin
NOT$0.0005259+0.28%
RealLink
REAL$0.07619+1.51%
Moonveil
MORE$0.003326-18.95%

1. What Is Money Laundering?


Money laundering is the process by which criminals transform illegally obtained funds (such as those from financial fraud, drug trafficking, terrorism, etc.) into clean, legitimate money. The process of money laundering generally involves three stages:

1.1 Placement: This stage involves placing illicit funds into the financial system (e.g., banks). Perpetrators try to make their actions appear legitimate by repaying debts, mixing the illegal funds with legitimate income, investing, exchanging foreign currency, and other related schemes.

1.2 Layering: In this stage, the criminals transfer the illegal funds through various means multiple times to make it difficult to trace. Using cryptocurrencies for transfers is one of the methods used for this purpose.

1.3 Integration: At this final stage, the "cleaned" money is taken out and deposited into the financial system for legitimate use.

2. What is Anti-Money Laundrying (AML)?


Anti-Money Laundering (AML) refers to the activities and measures implemented by institutions, platforms, and governments to prevent and combat financial crimes, particularly those involving money laundering and terrorist activities. In simple terms, it aims to prevent criminals from transforming illegally obtained funds into clean, legitimate money. AML efforts are present in various fields and not exclusive to the cryptocurrency field.

For cryptocurrency trading platforms, the following measures are typically taken when facing potential money laundering activities:

2.1 Identifying and reporting suspicious transactional activities, such as frequent trading from individual accounts, significant increases in transaction volumes, or large inflows and outflows of funds.

2.2 Freezing user accounts during investigations, preventing access to funds.

2.3 Submitting evidence to and cooperating with relevant authorities if illegal activities are confirmed. Efforts are made to return stolen funds to their rightful owners whenever possible.

MEXC, as a cryptocurrency exchange platform, maintains a strong stance against illegal activities, demonstrating a firm commitment to anti-money laundering and adhering to the implementation of relevant policies in different countries and regions.


KYC stands for Know Your Customer, which means fully understanding your customers. In simple terms, it refers to the process of identity verification, commonly known as real-name authentication.

KYC is one of the measures used in anti-money laundering efforts. Through the KYC system, businesses can obtain information about customers' identities, transaction behavior, credit status, and more, thereby preventing money laundering activities.

4. The Importance of Anti-Money Laundering (AML) in the Cryptocurrency Field


Cryptocurrencies have become a channel for illegal activities such as money laundering for the following reasons:

4.1 The characteristic of anonymity in cryptocurrencies increases the difficulty of AML efforts. Privacy coins like Monero (XMR) enable transactions with enhanced privacy, and mixing services represented by Tornado Cash (TORN) make it challenging to trace transactions, confounding regulators by making money laundering more convenient for illicit actors.

4.2 Cryptocurrency transactions are irreversible. Once funds are sent, they cannot be retrieved unless the recipient voluntarily agrees to a refund.

4.3 Lack of regulation in the cryptocurrency field creates opportunities for illicit actors to exploit the system.

Implementing AML measures in the cryptocurrency field helps protect the rights of legitimate cryptocurrency users and promotes the overall development of the industry. For platforms like MEXC, adhering to and enforcing AML policies is not only a contribution to the industry's advancement but also helps gain the trust of potential users and regulatory authorities, leading to better opportunities for future development.

Popular Articles

Safeguarding Industry Growth Amid Crypto Compliance Trends

Safeguarding Industry Growth Amid Crypto Compliance Trends

As cryptocurrencies become increasingly integrated into the traditional financial system, major digital assets are evolving beyond investment vehicles into important tools for payment and settlement.

MEXC Copy Trading Service Agreement

MEXC Copy Trading Service Agreement

This MEXC Copy Trading Service Agreement ("Agreement") is a contract between you ("you", "your" or "User") and MEXC ("we", "our", "us" or "MEXC"). It sets out the terms and conditions that governs you

MEXC Copy Trading Service Agreement

MEXC Copy Trading Service Agreement

This MEXC Copy Trading Service Agreement ("Agreement") is a contract between you ("you", "your" or "User") and MEXC ("we", "our", "us" or "MEXC"). It sets out the terms and conditions that governs you

How to Recover Funds Lost in ETH Transfer Scams? Step-by-Step Recovery Methods

How to Recover Funds Lost in ETH Transfer Scams? Step-by-Step Recovery Methods

Losing Ethereum to transfer scams is devastating, but recovery may still be possible if you act quickly.This guide walks you through the critical steps to take immediately after discovering fraud, fro

Hot Crypto Updates

Earn Sustainable Rewards with Infrared's Native IR Staking on Berachain

Earn Sustainable Rewards with Infrared's Native IR Staking on Berachain

1. Infrared Protocol Launches Revolutionary Native Staking Program on BerachainInfrared Protocol stands as a premier liquidity staking solution deeply embedded in the Berachain ecosystem, pioneering i

Converting Cryptocurrency to Fiat: A Comprehensive Guide

Converting Cryptocurrency to Fiat: A Comprehensive Guide

Converting cryptocurrency to fiat is a practical process with multiple reliable pathways—each suited to different transaction sizes, urgency levels, privacy preferences, and regulatory constraints—and

PROPS vs UNI: Comprehensive Investment Analysis for 2025

PROPS vs UNI: Comprehensive Investment Analysis for 2025

PROPS and UNI present markedly different investment propositions in 2025: PROPS offers speculative exposure to tokenized Southeast Asian real estate on a newer Layer 1 ecosystem, while UNI is an estab

XL1 vs GRT: A Comprehensive Investment Analysis for Crypto Infrastructure Tokens

XL1 vs GRT: A Comprehensive Investment Analysis for Crypto Infrastructure Tokens

XL1 and GRT present two distinct investment cases in crypto: XL1 is a utility token powering XYO Layer One's verifiable data-focused blockchain and positions itself inside the DePIN and oracle markets

Trending News

American Bitcoin’s $5B Nasdaq Debut Puts Trump-Backed Miner in Crypto Spotlight

American Bitcoin’s $5B Nasdaq Debut Puts Trump-Backed Miner in Crypto Spotlight

The post American Bitcoin’s $5B Nasdaq Debut Puts Trump-Backed Miner in Crypto Spotlight appeared on BitcoinEthereumNews.com. Key Takeaways: American Bitcoin (ABTC) surged nearly 85% on its Nasdaq deb

Uniswap Governance Approves UNIfication Proposal in Near-Unanimous Vote

Uniswap Governance Approves UNIfication Proposal in Near-Unanimous Vote

Uniswap governance has approved the UNIfication proposal, marking a major shift in the protocol’s economic model and setting UNI on a more explicitly deflationary

Decentraland Price Prediction 2026-2030: Can MANA Finally Reach $1?

Decentraland Price Prediction 2026-2030: Can MANA Finally Reach $1?

BitcoinWorld Decentraland Price Prediction 2026-2030: Can MANA Finally Reach $1? As the metaverse continues to capture global attention, investors are asking a

The Economics of Self-Isolation: A Game-Theoretic Analysis of Contagion in a Free Economy

The Economics of Self-Isolation: A Game-Theoretic Analysis of Contagion in a Free Economy

Exploring how the costs of a pandemic can lead to a self-enforcing lockdown in a networked economy, analyzing the resulting changes in network structure and the existence of stable equilibria.

Related Articles

How to Manage Sub-Accounts

How to Manage Sub-Accounts

1. What is a Sub-AccountUnder your MEXC account, you can set up multiple sub-accounts to assist you in your daily trading activities. For example, you can use one sub-account for spot trading and anot

KYC Uncovered: The Key to Crypto Trading and Finance

KYC Uncovered: The Key to Crypto Trading and Finance

1. AbstractKYC (Know Your Customer) is a globally recognized compliance procedure in the financial industry, designed to verify customer identities, understand their financial behavior, and prevent il

A Must-Read Before Trading Futures: Key Terms Explained

A Must-Read Before Trading Futures: Key Terms Explained

For many investors, futures trading is a field full of opportunities but also significant challenges. Compared to spot trading, it involves more specialized terminology and complex mechanisms. When yo

Quick Guide to Futures Information Terminology and Trade Futures with Confidence

Quick Guide to Futures Information Terminology and Trade Futures with Confidence

When you open the MEXC Futures trading interface, what greets you isn't just the dynamic candlestick chart, but also rows of constantly changing data and professional terms: Index Price, Fair Price, F

Sign Up on MEXC
Sign Up & Receive Up to 10,000 USDT Bonus