Case Study: MistTrack Empowers Virtual Asset Funds to Achieve AML Compliance and Risk Control
Background
In the operation of virtual asset funds, the source and flow of investors’ capital directly determine the level of compliance risk. With global regulations tightening, virtual asset fund service providers must not only ensure compliance at the KYC (Know Your Customer) level, but also extend scrutiny to KYW (Know Your Wallet) and SOT (Source of Token).
However, virtual asset fund service providers commonly face challenges such as complex sources of investor funds; massive amounts of public blockchain data that are time-consuming and error-prone to trace manually with internal teams; and a lack of efficient tools to align on-chain investigation results with compliance standards required by financial institutions.
As a company specializing in compliance services for crypto funds, Keyblock recognizes that ensuring the compliance of client funds requires the use of professional tools to transform on-chain data into compliance-ready information.
Therefore, since 2024, Keyblock has fully adopted MistTrack, the AML product under SlowMist, integrating its KYT solution with Keyblock’s own review mechanisms to complete KYW and SOT verification processes. This has strengthened Keyblock’s AML review framework and workflows, providing virtual asset fund clients with comprehensive compliance support.
Solution
In the daily subscription process of a virtual asset fund, the team must quickly determine whether an investor’s capital source is trustworthy and identify potential risks. MistTrack serves as a crucial tool in this process, converting complex on-chain data into actionable compliance insights through comprehensive risk assessments and address label analysis, enabling Keyblock to efficiently complete AML reviews:
Fund Risk and Source Analysis
In Keyblock’s standard subscription process, regardless of whether investor funds originate from CeFi or DeFi wallets, the addresses are first evaluated using MistTrack’s risk scoring system.
AML Scoring Function: By combining entity ownership of the address, historical transaction behavior, and intelligence from SlowMist’s threat database, MistTrack delivers a comprehensive risk assessment of wallet addresses. At present, it has identified 14 categories of risk sources:
- Sanctions
- Illicit Coins
- Terrorism Financing
- Coin Mixer
- Risky Exchange
- Darknet Market
- Illegal Services/Platforms
- Public Freezing Actions
- Gambling
- Centralized Bridge
- Privacy Protocol
- Decentralized Exchange (DEX)
- DeFi Protocol
- NFT Marketplace
Application Value: The efficiency of reviewing investor fund sources and risks has been significantly improved, while reducing both false positives and missed detections. This ensures every fund source is credible and compliant.
Low Risk
If the AML scoring returns a low-risk rating for an investor’s address, Keyblock accepts the investor’s subscription funds, further verifies the source, and ensures the funds are sufficient and originate from a trusted address.
Non-Low Risk
If the address risk score is not low-risk, Keyblock conducts deeper assessments by combining MistTrack’s address labels and fund tracing features. When necessary, Keyblock directly confirms findings with the MistTrack team. Only once the funds are deemed low-risk are investor subscriptions accepted.
Address Label Function: MistTrack has identified over 1,000 entities and maintains a database of 400 million+ address labels. This not only enables recognition of the entities associated with addresses but also links multiple on-chain and off-chain labels.
Application Value: With the help of address labeling, Keyblock can quickly assess the credibility of fund sources, enabling instant decision-making between “trusted VS. high risk.”
Visualization Investigation Function: MistTrack can visually present fund flows and transaction relationships, supporting filtering, sorting, and report export functions. This facilitates subsequent audits and submission to regulatory authorities.
Application Value: The Keyblock team is able to efficiently handle complex fund pathways, rapidly completing fund tracing and risk screening.
Triggering Risk Control
If an investor’s address risk score triggers Keyblock’s risk control requirements — such as when the address is highly associated with illicit activities (e.g., hacking, mixers, darknet fund sources) — Keyblock will suspend the investor’s fund injection. This prevents high-risk assets from entering the fund pool and ensures the filing of an STR (Suspicious Transaction Report).
Risk Report Function: Risk reports generated by MistTrack can be accessed via the web-based Dashboard or KYT API. These reports are used for compliance archiving and STR submission.
Application Value: The Keyblock team can quickly identify and address high-risk funds, thereby improving overall risk management efficiency. MistTrack’s visualization and reporting features further enhance the traceability of compliance operations.
Continuous Monitoring and Business Risk Analysis
In the daily operations of virtual asset funds, investor funds are constantly in motion, and a single review cannot fully cover potential risks. Keyblock needs to monitor the transaction activities of both the platform and client wallets in real time, promptly detect abnormal transactions, and take action to safeguard fund assets while meeting ongoing compliance requirements.
Transaction Risk Monitoring Function: MistTrack enables real-time KYT analysis of monitored addresses and issues alert notifications for risk-related transactions that meet predefined conditions. In addition, each KYT analysis result is stored and displayed on the Risk Score Overview page.
Application Value: After Keyblock adds client wallets to the monitoring list, AML functions can be implemented without writing any code. This allows potential high-risk transactions to be detected and addressed at the earliest possible stage.
Risk Score Overview Function: This feature displays real-time KYT analysis records from the transaction risk monitoring module, along with the call history of the OpenAPI Risk Score interface. Users can grasp the overall risk distribution from a macro perspective while also conducting in-depth analysis of individual transactions at a micro level — achieving both comprehensiveness and traceability in risk management.
Application Value: The Keyblock team can quickly identify high-risk transactions, providing a basis for further investigation, reporting, or compliance audits.
Client Feedback
Allen Li, Founder & CEO of Keyblock said:
“The wallet address risk scoring, labeling, and fund tracing features provided by MistTrack allow us to efficiently complete risk screening during daily reviews. Both efficiency and accuracy have improved significantly, greatly reducing the burden of compliance work.”
MistTrack Highlights
MistTrack offers a zero-barrier KYT solution that enables AML risk scoring, fund tracing, and transaction monitoring without the need for complex configuration or significant manpower investment. The platform comes equipped with an intuitive Dashboard and OpenAPI, supporting self-service activation via the web .With user-friendly product features and robust address label data, MistTrack helps exchanges, financial institutions, and Web3 projects effortlessly achieve AML compliance and risk control:
- Cryptocurrency Exchanges
- Financial Institutions (Banks / Brokers / Fund Services)
- Web3 Projects (DeFi Protocols / Cross-Chain Bridges)
Conclusion
Since establishing a strategic partnership with MistTrack, Keyblock has accumulated extensive hands-on experience, continuously optimizing compliance governance processes for virtual asset funds. This case demonstrates a successful example of compliance practice in the virtual asset fund industry. As global regulations tighten, more and more virtual asset fund service providers will need to leverage AML tools to enhance their compliance standards. MistTrack will continue expanding blockchain support, broadening data coverage, and refining risk identification algorithms to provide service providers with robust and reliable compliance infrastructure.
For more information or to experience MistTrack, please visit the official website. If you would like to share valuable feedback with us, you can contact us through the following channels:
X: https://x.com/MistTrack_io
Website: https://misttrack.io/
Email: support@misttrack.io
About Keyblock Solutions
Keyblock is an independent compliance service provider for crypto funds, specializing in delivering efficient and secure fund compliance and operational outsourcing services. The Keyblock team is deeply familiar with the virtual asset ecosystem and has extensive fund operation experience. Their professional backgrounds span digital asset trading, software engineering, fund compliance, and operations management. Keyblock is committed to establishing best-in-class fund operation standards for a wide range of digital asset fund strategies, including CeFi, DeFi, venture capital, and computing power development.
About SlowMist
SlowMist is a blockchain security firm established in January 2018. The firm was started by a team with over ten years of network security experience to become a global force. Our goal is to make the blockchain ecosystem as secure as possible for everyone. We are now a renowned international blockchain security firm that has worked on various well-known projects such as HashKey Exchange, OSL, MEEX, BGE, BTCBOX, Bitget, BHEX.SG, OKX, Binance, HTX, Amber Group, Crypto.com, etc.
SlowMist offers a variety of services that include but are not limited to security audits, threat information, defense deployment, security consultants, and other security-related services. We also offer AML (Anti-money laundering) software, MistEye (Security Monitoring), SlowMist Hacked (Crypto hack archives), FireWall.x (Smart contract firewall) and other SaaS products. We have partnerships with domestic and international firms such as Akamai, BitDefender, RC², TianJi Partners, IPIP, etc. Our extensive work in cryptocurrency crime investigations has been cited by international organizations and government bodies, including the United Nations Security Council and the United Nations Office on Drugs and Crime.
By delivering a comprehensive security solution customized to individual projects, we can identify risks and prevent them from occurring. Our team was able to find and publish several high-risk blockchain security flaws. By doing so, we could spread awareness and raise the security standards in the blockchain ecosystem.
