1inch DEX Implements Stringent Wallet Screening Process Arigatou

1inch DEX has initiated a comprehensive filtering process targeting hundreds of wallets involved in illegal activities.

Starting from August 2022, 1inch DEX integrated TRM Wallet Screening, an Anti-Money Laundering (AML) risk assessment tool developed by TRM Labs.

According to reports, TRM's API allows 1inch to query data regarding the extent of interaction of an address or transaction with illegal activities, including categories such as sanctions violations, terrorist financing, hacked funds, hacker groups, ransomware, fraud, human trafficking, and child sexual abuse material (CSAM).

Based on these queries, TRM Wallet Screening provides risk scores indicating:

• Risk of ownership if an address is owned, controlled, or linked to a sanctioned entity or engaged in illegal activities.
• Counterparty risk if an address has transacted with a sanctioned address or one involved in illegal activities.

Using the risk factors identified by TRM's API, 1inch systematically restricts users from connecting to 1inch dApps, 1inch Wallet, or 1inch APIs. Users who believe their address has been wrongly restricted can file a complaint with the DEX for individual review.

Since implementing wallet screening, 1inch DEX has reported a steady increase in the number of restricted wallets each month. Common risks identified include wallets associated with providers of child sexual abuse material, fraud, and stolen funds.

Moreover, the decentralized exchange is actively seeking to enhance service quality amid regulatory developments focusing on legislation for DeFi platforms.