Picture an all-too-common scenario. A high-net-worth individual sells part of his crypto holdings. The profits are transferred to his bank account. But what then follows is not a celebration, but a freeze. Questions about the origin of his wealth. Requests for documentation. Weeks of uncertainty.
For many crypto holders, this has become a familiar experience – one that’s not just frustrating, but increasingly unsettling. Legitimate crypto owners find themselves asking: ‘Did I do something wrong?’ and even: ‘Am I about to become the subject of an investigation?’
The reality is more nuanced. Fewer than five percent of crypto holders have criminal intent. But banks are legally required to examine unusual financial flows. And that is precisely where the tension arises, not because crypto is inherently risky, but because the current compliance process was never designed for digital wealth.
Wallet analysis is not enough
Today, many banks assess crypto at wallet or transaction level. They look at where a specific transaction came from and whether a wallet is linked to a risk label. That is a logical first step, but it is not enough for a legally defensible compliance decision.
A single wallet says nothing about the full build-up of wealth. One transaction does not explain how wealth was accumulated, moved or realised. And yet decisions are sometimes made on the basis of fragments.
In practice, banks try to close this gap with consultants, spreadsheets and manual reconstructions of transaction histories. That works to a certain extent. But it is labourintensive, difficult to reproduce and hard to scale. In a market where digital wealth continues to grow, it is not a sustainable solution.
From single fragments… to the entire portfolio
According to Cense, a Swiss fintech specialising in digital wealth analysis, the solution lies in a fundamentally different approach: portfolio-based compliance.
“If you want to make a decision about digital wealth, you need to understand the full wealth story,” says co-founder Dennis Wohlfarth. “Not one wallet, but the entire portfolio. Where did the wealth begin? How was it built? Which gains were realised? Were internal transfers processed correctly? Only then can you form a well-founded judgment.”
The process starts on the fiat side, at the bank. When crypto-related financial flows are identified there, a structured investigation follows: collecting data, normalising transactions, reconciling internal movements, enriching the file with risk information and ultimately producing a substantiated report.
What is often undertaken manually today becomes reproducible and consistent. Not to be stricter, but to promote better, deeper understanding.
Partnered with Chainalysis
Cense clearly positions itself as a complement to existing blockchain analytics providers. It recently became a technology partner of Chainalysis, which is globally known for its wallet risk labelling.
“Risk labels are valuable,” Wohlfarth says. “But a bank has to do more than look at labels. It needs to build a complete picture that will stand up to internal controls and supervisory review.”
By combining Chainalysis risk intelligence with calculations on wealth accumulation, realised gains and portfolio context, a more complete view of the customer emerges. This combined approach is already being used by Van Lanschot & Kempen in its renewed onboarding process for crypto wealth. As a result, crypto compliance is shifting from incidental assessment to an integrated process.
Towards a new standard
What applies to crypto today will apply tomorrow to a broader category of digital wealth, from tokenised assets to digital securities. Banks cannot ignore this development and need to adapt their compliance processes accordingly.
According to Cense, portfolio-based analysis is not a luxury, but a necessity. Its purpose is not to restrict innovation, but to enable normal customers – the overwhelming majority – to access the financial system and crypto without unnecessary friction.
The company, which was recently named the European fintech winner in Mastercard’s annual competition, has a clear goal: to ensure that digital wealth is assessed as predictably and transparently as traditional assets. In doing so, it is enabling every bank to become a crypto-friendly bank.
That is why Cense uses deterministic technology that always produces the same output for the same input. For a portfolio with 500,000 transactions, hundreds of different assets, and complex DeFi structures, this requires advanced computational power – not to ‘check harder’ but to understand more completely.
Cense began in 2023 as a spin-off from Glassnode, an established name in crypto data analytics. Its first design partners were Swiss crypto-native banks, where some of the most complex use cases surfaced early on. Today, Cense works with more than 10 banks, including Van Lanschot Kempen in the Netherlands.
“The standard is shifting from wallet analysis to portfolio understanding.”’
Cense checks: Detect and Decode
Detect identifies whether crypto-related activity is present in the first place, often from fiat-side signals at the bank.
Decode reconstructs the financial reality behind that activity by turning fragmented wallet, exchange and transaction data into a coherent portfolio story.
See how Detect and Decode turn crypto complexity into compliance clarity. www.cense.com
Cense was recently named in this year’s FinCrimeTech50, which identifies the companies leading tech companies fighting money laundering, fraud and financial crime in financial services. The full FinCrimeTech50, including profiles on each company, can be found here.
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