KYC/AML And Crypto Related Most Asking Questions in Interview

?Cryptocurrencies: Cryptocurrency is a digital payment system that doesn't rely on banks to verify transactions. It’s a peer-to-peer system that can enable anyone anywhere to send and receive payments.

??????? (???????? ???????? ????????????????): KYC is like getting to know someone before you trust them. In the crypto world, it's a process where companies verify the identities of their customers. This helps prevent bad people from using cryptocurrencies for illegal activities.

??????? (?????????????????????? ?????????????? ????????????): A PEP is like a person who has a special job in the government or politics. Because they're in important positions, they need to be watched more closely to make sure they're not doing anything shady with their money.

?Stages of Money Laundering: Money laundering involves three key stages.

First, there's 'Placement,' where illegal money is sneaked into the financial system, making it appear legitimate, like blending into a crowd.

Second is 'Layering,' a stage of confusion where criminals move money around, making it hard to trace.

Finally, there's 'Integration,' where the money reappears and looks clean.

?Blockchain: A blockchain is a distributed and decentralized digital ledger or record-keeping system that is used to securely and transparently record transactions across a network of computers.

?Hashing: Hashing is a fundamental process. It involves taking data, such as a transaction or a block of information, and using a mathematical function to convert it into a fixed-length code, known as a hash. This hash serves as a unique fingerprint for the data and is crucial for data integrity and security on the blockchain.

????????? ????????????????????????: Hash transactions are like digital fingerprints for data in the crypto world. They're unique codes generated using a special math process that changes if even a tiny part of the data changes. It's a way to ensure data integrity and security in things like blockchain transactions.

????????????? ??????????: Crypto fraud is when dishonest individuals use deceptive tactics in the cryptocurrency space to steal or trick people out of their money or assets. As a P2P Support Manager, I have experience in detecting these fraudulent activities and preventing them from happening.

????????????????????? ??????????: Blockchain tools are digital helpers that make working with blockchain technology easier. They could include software to track transactions, analyze data, and ensure security. In my role, I've used these tools to investigate blockchain activities and ensure compliance with regulations. Ex Bscscan, Solscan, etherscan, mempool.space.

??????????????????????? ?????????? ????????????: Crypto, short for cryptocurrency, is like digital money. It's based on special technology called blockchain. People use it to buy things online and make transactions. It's a bit like having money, but in a computer.

??????????? ????????????????????: Money laundering is like making dirty money look clean. Bad people might try to hide their illegal money by moving it around so it looks legal. It's against the law and can happen with regular money or cryptocurrencies.

??????????? ????????????: Money-Muling is when someone is tricked into moving stolen money for someone else. They might not know it's stolen, but they're helping bad people by moving the money around.

??????? ??????????????: Tax evasion is when someone breaks the law by not paying the taxes they're supposed to. It's like trying to sneak out of paying your fair share of taxes to the government. This can happen in different ways, such as hiding income, lying about deductions, or using secret accounts to hide money.

??????? (???????????? ???? ??????????): This refers to where the money comes from, especially in financial transactions. It's important to know if the money is from a legitimate source or if it might be linked to illegal activities.

??????? (???????????? ???? ????????????): This is about understanding a person's overall wealth and assets. It helps to figure out if someone's lifestyle and wealth match up with their known sources of income.

??????? (???????????????????? ???????????????? ????????????): This is a report that financial institutions must file when they suspect that a customer's financial transactions may involve illegal activities. It's like a red flag to alert authorities to investigate potentially suspicious behavior.

?STR (Suspicious Transaction Report): Similar to SAR, this report is filed when a suspicious financial transaction is detected.

??????? (???????????????? ?????? ??????????????????): This is the process of verifying and understanding who your customers are. To make sure they're not involved in illegal activities. It involves checking their identity, assessing their financial behavior, and ensuring they're not a risk to your business.

? Enhanced Due Diligence (EDD): EDD is a higher level of due diligence that involves a deeper investigation into high-risk customers. It’s often used for PEPs or customers with complex transactions.

?Mining: Mining in blockchain is the process of adding new transactions to the blockchain through a competitive and computationally intensive process, ensuring the network's security and decentralization while incentivizing participants with rewards.

?Crypto Wallet Vs Crypto Address: A crypto wallet is the overall tool that manages your cryptocurrencies, while a crypto address is a component of the wallet used to receive funds.

?Cryptocurrency Mixer: A cryptocurrency mixer like a blender for your digital money. It takes your cryptocurrency (let's say Bitcoin) and mixes it with other people's Bitcoin. Then, it gives you different Bitcoin from what you originally had. A cryptocurrency mixer helps hide the trail of your digital money, making it difficult for anyone to figure out your financial transactions on the blockchain.

?Proof of Work Vs Proof of Stake: PoW relies on computational power and energy consumption to secure the network, while PoS relies on validators who hold and lock up cryptocurrency as collateral. Both consensus mechanisms have their advantages and trade-offs, and their suitability depends on the specific goals and needs of a blockchain network.

? Virtual asset service providers: A Virtual asset service provider (VASP) means any natural or legal person who is not covered elsewhere under the Recommendations and as a business, conducts one or more of the following activities or operations for or on behalf of another natural or legal person.

? AML (Anti Money Laundering): AML for cryptocurrencies refers to the laws, rules, and policies put in place to prevent criminals from turning unlawfully obtained cryptocurrency into cash.

? Threat intelligence: also called ‘cyber threat intelligence’ (CTI) or ‘threat intel’—is data containing detailed knowledge about the cybersecurity threats targeting an organization.

? Red Flags: Indicator or warning signs that suggest a transaction or customer might be involved in illicit activity.

? Transaction Monitoring: this involves continuously monitoring customers transactions to detect unusual or suspicious patterns that may indicate money laundering or fraud.

?Transaction Tracking: Transaction tracking involves following the journey of a specific transaction or set of transactions from initiation to completion, providing a detailed record of its path through the financial system.

? Decentralized: Decentralized refers to a system or organization where decision-making authority and control are distributed across multiple entities, eliminating the need for a central authority. This concept is often applied in technology, such as blockchain networks and decentralized applications (D’Apps), as well as organizational structures like Decentralized Autonomous Organizations (DAOs) and decentralized finance (DeFi). Decentralization aims to enhance transparency, security, and resilience by avoiding reliance on a single point of control.

?Centralized: Centralized refer to a system whereby all the planning, decision-making and action-taking activities are controlled by a particular or single authority or platform.

?Cold wallet: A cold wallet is a cryptocurrency wallet that is not connected to the internet. It is considered a more secure storage option because it is less susceptible to online hacking attempts.

?Hot Wallet: Hot wallets are convenient for frequent trading, transactions, and quick access to funds. They are often used for day-to-day activities where immediate access to cryptocurrencies is required.

?Smart-Contract: A smart contract is a self-executing contract with the terms of the agreement directly written into code. It operates on a blockchain, a decentralized and distributed ledger technology that ensures transparency, security, and immutability. Smart contracts enable programmable and automated execution of predefined actions when specific conditions are met, without the need for intermediaries.

?CTF (Counter Terrorism financing): Measures and regulation designed to prevent the funding of terrorist activities through the financial system.