Coinbase Urges US Treasury to Adopt AI and Blockchain for Crypto AML Compliance

Coinbase filed a 30-page response to the US Treasury on October 17, 2025, under the GENIUS ￰0￱ Bank Secrecy Act (BSA), a 1970 law requiring financial institutions to report suspicious activities, fails digital assets, Coinbase ￰1￱ Legal Officer Paul Grewal stressed modern tools must counter advanced crypto ￰2￱ and Blockchain Solutions Coinbase seeks BSA safe harbors for AI and API-based compliance ￰3￱ focus on governance, cut false positives, and protect privacy. Zero-knowledge proofs and decentralized IDs streamline user verification. “Criminals innovate; we must too,” Grewal posted on ￰4￱ and Regulatory Sandboxes Coinbase advocates know-your-transaction (KYT) blockchain analytics to track asset ￰5￱ surpasses outdated reporting that overwhelms regulators.

Anti-Money Laundering (AML), the framework to stop illegal funds entering financial systems, needs modernization, Coinbase ￰6￱ firm urges Treasury to endorse KYT and create sandboxes for testing public-private compliance ￰7￱ to 2020 AML Act The proposals support the 2020 Anti-Money Laundering Act’s goal to update ￰8￱ AML systems generate excessive, low-value data, Coinbase ￰9￱ and blockchain could curb sophisticated crimes without hindering innovation. Treasury’s response is pending.