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Financial institutions should individually assess each cryptocurrency exchange with which their customers transact to manage risks properly, a blockchain-focused analytical firm Chainalysis has written in a new report.

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According to the well-known crypto investigative company, if banks want to accept crypto in the long term, they should already start searching for all the ways their clients are funding digital wallets.

The banks should examine not only each exchange’s business model, but also compliance program quality, and jurisdiction of operation, Chainalysis claims. However, the firm highlights these components are not sufficient on their own:

"Banks also need to evaluate exchanges’ compliance effectiveness by measuring their exposure to risky counterparties elsewhere in the cryptocurrency ecosystem."

Chainalysis thinks banks should rather to start getting familiar with the crypto market right now, rather than waiting until watchdogs are demanding it.

Earlier in September, the US Office of the Comptroller of the Currency (OCC) published a new letter according to which, the US financial institutions can keep reserves on behalf of stablecoin issuers.

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The letter states that a bank providing services in support of a stablecoin project "must comply with all applicable laws and regulations and ensure that it has instituted appropriate controls and conducted sufficient due diligence commensurate with the risks associated with maintaining a relationship with a stablecoin issuer."

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