Chainlink Labs Proposes Solutions for Detecting Illegal Digital Asset Activities

In response to a request for comment from the U.S. Treasury regarding innovative methods to detect illegal financial activity involving digital assets, Chainlink Labs has offered four key concepts aimed at enhancing detection while minimizing privacy and operational risks. This initiative is part of the implementation of the GENIUS Act. The concepts put forth by Chainlink Labs include portable digital identities, distinguishing management control from customer relationships, rule-based on-chain compliance, and cryptographically assured reserve transparency. Chainlink Labs further expressed its commitment to providing detailed information to support Treasury research and any subsequent regulatory guidance or development.