Intermediary Compliance

Definition ∞ Intermediary compliance refers to the adherence of financial intermediaries, such as cryptocurrency exchanges, brokers, and custodians, to applicable laws and regulations. This includes obligations related to anti-money laundering (AML), know-your-customer (KYC), and sanctions screening. Effective intermediary compliance is essential for preventing illicit financial activities and maintaining regulatory approval. It ensures responsible market operation.
Context ∞ News often focuses on the increasing demands for intermediary compliance within the digital asset sector, driven by global efforts to combat financial crime. Regulators are intensifying their scrutiny of platforms to ensure robust controls are in place. The cost and complexity of meeting these compliance standards represent a significant operational challenge for many digital asset businesses.