Money laundering risks of cryptocurrencies: Towards coordinated regulatory and technological strategies

Abstract

This policy paper reviews the evolution of research from 2016 to 2024 on the role of digital assets in illicit financial flows and evaluates the effectiveness of existing detection and prevention strategies. It highlights two central policy imperatives for Latin America: (i) fostering regional cooperation among central banks to harmonize anti-money-laundering standards and address regulatory arbitrage, and (ii) integrating supervisory technologies (SupTech and RegTech) into compliance frameworks to improve detection capacity. The paper concludes that combining technological innovation with coordinated regional regulation is essential to safeguard financial integrity in the digital-asset era.