As 2025 unfolds, Virtual Asset Service Providers (VASPs) are facing unprecedented regulatory scrutiny.
The maturing digital asset market has brought with it heightened expectations from regulators, banking partners and clients, signalling the end of loosely managed onboarding and vague due diligence.
KYC Portal CLM, which offers an advanced CDD and AML data collection and collation CLM platform, recently explored the current landscape for VASPs
VASPs, whether involved in digital asset trading, custodial wallets, NFTs, tokenised assets or DeFi, are now expected to match the rigour and transparency of traditional financial institutions, with compliance that is embedded, auditable and immediate.
Meeting these expectations requires more than policy manuals. It demands a complete overhaul of how client data is gathered, processed, risk-assessed and maintained throughout the customer lifecycle, it said. This is where Client Lifecycle Management (CLM) platforms such as KYC Portal CLM can provide a competitive advantage.
Regulators worldwide are shifting from guidance to enforcement. The Financial Action Task Force (FATF) Travel Rule is now actively applied, while the EU’s Markets in Crypto-Assets Regulation (MiCA) has taken full effect, imposing strict onboarding, record-keeping and reporting standards. Even jurisdictions once seen as lenient are tightening rules to avoid blacklisting.
Compliance teams now juggle identifying ultimate beneficial owners (UBOs), validating sources of funds, conducting ongoing monitoring and ensuring up-to-date records—often while relying on fragmented tools and manual processes.
In this climate, traceability and proof of compliance matter more than speed. Traditional KYC methods—static forms, one-off risk checks and reactive reviews—are ill-suited to the pace and complexity of virtual assets. Clients operate cross-border, transaction volumes are high, and risk profiles shift rapidly. Modern KYC must be continuous, adaptable and fully auditable.
KYC Portal CLM addresses this by offering an end-to-end AML compliance management framework covering onboarding, due diligence, risk scoring, reviews, documentation, approvals and offboarding, all in one centralised system. It enables VASPs to configure their own policies without development work, adapting workflows and risk models in real time as data changes.
The platform’s features include dynamic document collection, structured periodic reviews, granular access controls and a complete audit trail. This ensures compliance teams can trace historic decisions, adjust to regulatory updates overnight and demonstrate control to auditors or partners. With its no-code, rules-based architecture, KYCP adapts as regulations, risk appetites and product offerings evolve.
For more information about VASPs, read the full story here.
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