3 Questions for Department Advisor Amanda Wick

Amanda Wick is Founder & CEO of the Association for Women In Cryptocurrency and Principal at Incite Consulting LLC. She was previously Senior Investigative Counsel for the House Select Committee Investigating the January 6th Attack on the US Capitol, a federal prosecutor at the Department of Justice, a Senior Policy Advisor at FinCEN, and was the Chief of Legal Affairs at Chainalysis. You can find her on X at @Amanda_S_Wick.

Matt Homer: I’ve heard you speak before about how you think crypto can actually make it easier for regulators and law enforcement to do their jobs. The example you provided was the broken Suspicious Activity Reports (SAR) paradigm we have today for traditional finance compared to the capabilities that exist with blockchain analytics. Can you tell us more about how you got interested in crypto and what excites you about it? 

Amanda: As a federal prosecutor that ran a SAR Review Team, I had to review thousands of suspicious activity reports that were irrelevant and just added noise. Our current system generates so much chaff, filed by financial institutions that are erring on the side of caution because the process for analyzing data and determining what counts as “suspicious” is so antiquated and was designed for a system involving cash and bank accounts. Today’s financial transactions are so much more complex, and tech like GPR cards, digital assets, virtual currencies, etc., pointed out how desperately we need BSA modernization to have effective anti-money laundering and countering terrorist financing programs. Crypto gives us so much visibility into transactional risk. If we could harness the power of on-chain and off-chain data analytics with a commensurate level of innovation in our regulations, we could make our AML/CFT programs wildly more effective at providing law enforcement with so much more wheat than chaff. 

Matt Homer: We first met at a techsprint that focused on developing new tools for regulators to  supervise digital asset firms and for firms themselves to achieve compliance more effectively. In fact, if my memory is correct, I believe you were on the winning team. You’ve also worked for one of the first companies to show what is possible here. What do you see as the future of supervision and compliance for digital assets and is there an opportunity to do things better than in prior eras of financial services? 

Amanda: Technically, I was on one of the three winning teams–Chen Arad and Joe Schifano were my co-winners! The funny thing is, for a long time afterward, we would talk about how the industry needed all three solutions. And that is a passion of mine, looking at RegTech and SupTech and figuring out where we need better tools to help regulators address their challenges. One of the problems in financial services and fintech is you have a lot of people who want to build Teslas and get those 30X VC returns, but they don’t want to spend the money to upgrade the cobblestone roads the Teslas are driving on. RegTech and SupTech, and building the tools that regulators will need to properly supervise, examine, and monitor these products, are not sexy but they are essential. This is why, together with Blockchain APAC, Incite Consulting is hosting a RegTech Forum in London in October to try to have similar conversations to what we had in the techsprint. Because those conversations are rarely had at conferences that are seeking to make money and sell tickets. We need more events that are geared towards actually moving the needle and seeing progress, which sometimes isn’t that profitable, but is critical. If we can combine the beauty of data analytics, privacy technology, and AI, we could greatly improve supervision and compliance for digital assets by giving regulators the tools they need. 

Matt Homer: What’s one thing you wish founders understood better about regulation, law enforcement, and government more generally? 

Amanda: When I was Chief of Legal Affairs at Chainalysis, there was a startup motto I heard of “move fast and break things.” So I used to think of us as a bus hurtling down a mountain, on one of those roads where there is a ravine on the other side. I think what founders should be looking for in their in-house lawyers or advisors is someone who can get that bus to the bottom with everyone on board alive, while telling you on the way down the real cost of what you’re breaking. Losing a rear-view mirror or bumper is fine; losing a transmission, not so much. The goal is to put up the smallest guardrails so that you don’t drive over the cliff, you can go as fast as safely possible, and you get to the bottom with what is essential. But I’ve met too many founders who think they don’t need any guardrails (usually because they want to ignore the “fin” part of FinTech), or they have their own “measure for risk” based on hubris and no relevant risk management experience–and they’re often wrong. Watching great products be mismanaged unnecessarily is heartbreaking. Find a good advisor that believes in what you’re doing and wants to get that bus down the mountain, who you can trust to know the difference between a bumper and an engine. And have the self-awareness to know that if your background is in tech, and you’re entering the most highly regulated space in the world–financial services–you’re going to need someone who knows enough about regulation, law enforcement, and government to be a helpful backseat driver and keep you from going over a cliff full of possible prosecutions, enforcement actions, and investigations. 

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