cRYPTO Glossary

Anti-Money Laundering (AML) refers to a set of international laws and regulations enacted to prevent criminal organizations or individuals from disguising illegally obtained funds as legitimate income, especially through cryptocurrencies.

Explanation of Specific Terms:

• Criminal organizations: Groups involved in illegal activities such as drug trafficking, terrorism, or fraud.
• Money laundering: The process of concealing the origins of illegally obtained money, typically by means of transfers involving foreign banks or legitimate businesses.
• Cryptocurrencies: Digital currencies that use cryptography for security and operate independently of central banks.

Key Points for Beginners:

• Why it's important: AML laws aim to detect and prevent money laundering activities, ensuring the integrity of financial systems and protecting against criminal activities.
• How it works: Regulations require financial institutions, including cryptocurrency exchanges, to implement procedures for customer due diligence, monitoring transactions, and reporting suspicious activities to authorities.