Singapore is one of the places where the rich and the mafia tend to come in for storing their illegal stash. And they want to turn that into the white money and then take it out of the nation. When such things were on small scale, nations around the world benefit but when it becomes daily activity, it becomes global crime.
Singapore has a plan to collaborate with the nations that are struggling with the financial crimes. So they also created an organization named COSMIC. This would be helping them collaborate on the legal scale to share the resources, custody and the transfer rights in context of financial crimes.
Let's take a look at the singapore's monetary authoriy of singapore creating COSMIC and how it would work in near future.
What is COSMIC platform? How does it work?
COSMIC stands for the "Collaborative Sharing of Money Laundering/Terrorism Financing (ML/TF) Information & Cases". This is official display of the COSMIC definition. And it would be covering variety of banks as of now 6 are listed officially. You may also notice organizations like SEC and the CFTC would be joining such efforts and the sharing of the data in such crimes can help too.
Currently COSMIC is trying to keep an eye on three different things like usage of the legal person, trade finance for illicit purposes and rapid growth of the finances. All of this would be benchmarked against a set of criteria like say threshold out of which it would be judged and handled for the platforms sanity. This is what is platform intends to do to stop the financial crimes. You can read about it here.
How does this platform reduces financial crimes and find out the issues in the financial growth and assets?
COSMIC platform which is designed for the handling of the global financial crimes. It would be paying attention to the threshold and the benchmark criteria in the financial transactions and the two endpoints between the participating banks. So say some mafia is transfering funds from the participating bank A to B. This would make it easier for them to track the crime and then ban the same.
There would be the systems developed to warn each other of the financial activities that could be potential affecting the banks and the nations. And this would be handled on the singular point of contact through sharing of such information. As the crypto transactions are slowly affecting the market this too would end up creating more crime being logged by the platform in near future.
You can check out the details on its function here.
Future of Blockchain Finance Crimes
As it stands now people earn the blockchain online and then spend locally with the fiat conversion. Such mixers work for few years and then they end up dead. So the exchanges are the next target and then the banks. So the blockchain financial crimes are definitely the new place where the systems like these would be in effect. Though how that would work while the decentralized systems are out there is a bit mystery.
Most likely the regulation would make the DeFi redundant and it would also hurt the way the systems are built. So the future of the blockchain finance through DeFi would be both increased and also the amount of crimes would increase. Such systems can be handy especially if multi nations use it for the exchange of such crime data and the financial loopholes.
Singapore's Monetary authority MAS has done a good job by creating a COSMIC platform to help navigate across the system that would help share the financial crime data to the participating banks. Let's see what type of improvement they bring in near future.