The cryptocurrency market is growing, as a result, it's necessary to be cautious.

The market is overflowing with various coins, some of which are considered a good investment, but others are not quite... clean.

What is considered a "dirty" cryptocurrency?

A dirty crypto is the one that has been employed to facilitate money laundering or other illegal endeavours. Many people see the benefits of cryptocurrency (anonymity, decentralization), but others may harbour a negative attitude.

Typically, "dirty" cryptocurrencies are categorized into 2 large classes:

1. Any cryptocurrency that is illegally obtained: stolen from another person, or stolen from the organization.

2. The cryptocurrency that was employed in the commission of the crime: to purchase illegal goods (e.g. drugs, weapons), or to finance illegal activity (for example, child pornography).

If you have no criminal history in regard to dirty assets, but they end up in your wallet, they still are dirty. Ignorance of the law doesn't constitute an immunity from responsibility, so if you choose to engage in any transactions with them, the exchange may not be able to accept them or completely block them.

How can you understand that the cryptocurrency is “dirty”?

The answer is simple: AML services.

AML is short for "anti-money laundering", and it's the recognition of financial crime based on analysis of data.

Unique services have been developed for cryptocurrency that preserve your assets. The most famous of them are: Crystal Blockchain and Chainalysis.

I bought a "dirty" cryptocurrency, what is to come?

The effects are different depending on the country you are in. Typically, due to the presence of dirty cryptocurrency, you will deal with this:

1. The freezing of transactions and the loss of funds.

2. Wallet and account blocking on regulated exchanges.

3. High fines (up to €200,000).

4. Criminal liability.

How can you protect yourself from "dirty" cryptocurrency?

If you don't want to spend funds on AML services, then you should deposit crypto on a reputable platform, such as Kolo.

Kolo is a dependable and simple platform, that employs AML/CTF, KYC/CDD procedures. This facilitates the conduct of an asset audit for you.