Customer Story

Cabital Differentiates in a Crowded Market by Proving its Compliance Approach with Chainalysis

  • Gained perfect complement to in-house compliance system and procedures
  • Instilled trust in investors, banks, regulators, customers, and partners about handling risk and compliance
  • Continually evolves by harnessing Chainalysis compliance expertise and knowledge
  • Gained key element to launch innovative industry-standard exchange platform

From the start, we decided to focus on compliance, and investing in Chainalysis’ database and services and tools is what makes us different from other exchanges. Once we have all our components in place, we want to become the PayPal of the cryptocurrency world.”

– Raymond Hsu, CEO, Cabital

About Cabital

Cabital was established in 2020 by a team with extensive experience in the finance industry. The team formed Cabital because it believes in the democratisation of crypto: Everyone should be able to participate in crypto, not just financial experts or tech geniuses. Cabital created a secure and user-friendly crypto environment with a wide range of crypto products on an intuitive platform built for everyone, from beginners to seasoned traders.

Challenge 

From the start, Cabital wanted to set its platform and exchange apart with its compliance-first approach. Its goal was to partner with a trusted, reputable vendor offering a comprehensive database and easy-to-use tool.

Solution 

Cabital chose Chainalysis based on its market reputation, detailed database, and algorithm. To round out its compliance approach, it selected Chainalysis Know Your Transaction (KYT) to monitor crypto transactions, and Chainalysis Reactor to investigate and combat money laundering and other illegitimate transactions. 

Chainalysis KYT and Reactor are robust and efficient, and we keep learning and improving with their resources and support.”

What prompted your initial interest in working with a company like Chainalysis?

Crypto is a new technology, but at the end of day, we think it will be categorized as a financial service. So we have to have a very strong database and tool to manage the risk. There’s no way a company can do this without this tool or themselves using their own product. It has to be consolidated by a team with strong resources, knowledge, and experience. So,  we decided to buy Chainalysis to overcome our inability to develop and/or enforce regulatory requirements due to lack of knowledge. Reg Tech is one of the hardest things right now, and many companies are out there. We tried four of them but what really caught our attention about Chainalysis is that their previous CTO was chosen to be the director of the Financial Crimes Enforcement Network (FinCEN). That’s a strong endorsement. It says the US government knows that Chainalysis is very good and has significant knowledge about this space.

How has Chainalysis enabled you to build trust with banks?

Banks want to do due diligence on our compliance. Our compliance officer is super experienced in this area and I know compliance quite well because I’ve built a compliance product in the PSP space from scratch. 

The one question banks always ask is how we can be sure to avoid crypto money laundering. Chainalysis  KYT is crucial to that discussion. We benefit from whatever progress Chainalysis makes in this area because we use Chainalysis to convince these key stakeholders. 

Combined with the fact that we comply with KYC, we are strongly protected. If we know our customers and have a very comprehensive view of fees and crypto transactions, we are in a good position.