Wallet Intelligence (KYW)

Wallet Intelligence, also called KYW or Know Your Wallet, helps compliance teams understand what kind of wallet they are dealing with before or during a transaction review. It classifies a wallet as custodial, non-custodial, or unknown and explains the signal behind that classification.

KYW is designed to answer a practical compliance question:

Is this wallet likely controlled by a regulated service provider, by the customer directly, or is there not enough information to decide?

This matters because custodial and non-custodial wallets often require different handling in Travel Rule, MiCA, and internal AML workflows.

KYW checks a wallet address and returns:

• the likely wallet type: custodial, non-custodial, or unknown
• a confidence level
• the reason for the classification
• an audit reference
• entity and risk information when CryptoSwift can identify the wallet owner or related entity

This lets an operations or compliance user decide which workflow should happen next.

CryptoSwift combines multiple signals instead of relying on a single source:

• Previous wallet verification - If the wallet has already completed self-hosted wallet verification, KYW can classify it as non-custodial with high confidence.
• Known platform wallets - If the wallet is registered by a CryptoSwift platform tenant, KYW can connect it to a known organization.
• Partner-network information - When available, network data can help identify the wallet owner.
• Blockchain analytics - If enabled, analytics can identify known services, entity types, and risk signals.
• Known wallet applications - Some entities are self-hosted wallet apps rather than custodians, so KYW treats them as non-custodial.
• Behavioral heuristics - If no owner is found, KYW looks for wallet behavior patterns that suggest private-key ownership, automated custodial behavior, or insufficient evidence.

The result includes a human-readable reason so the classification can be explained during review or audit.

Use KYW before releasing funds to the destination wallet.

1. The customer enters a destination wallet address.
2. Your system calls KYW.
3. If the wallet looks custodial, continue with counterparty VASP identification and the Travel Rule message flow.
4. If the wallet looks non-custodial, apply your self-hosted wallet policy. This may include wallet verification, additional customer questions, or a threshold-based review.
5. If the wallet is unknown, route it to the fallback path defined by your policy.

Use KYW when a deposit arrives without enough Travel Rule context or when the customer says the funds came from a self-hosted wallet.

KYW can help operations decide whether to:

• ask the customer for missing Travel Rule or source-of-funds information
• run wallet verification before releasing funds
• route the case to manual review
• treat the wallet as likely custodial and continue counterparty identification

Confidence should be read together with the attribution reason. A high-confidence classification from a completed wallet verification is stronger than a low-confidence heuristic result.

Store the KYW result alongside the transaction or case record:

• wallet address and blockchain
• wallet type
• confidence and confidence score
• attribution reason and reason code
• entity details when present
• risk score when present
• KYW audit log ID
• timestamp and operator or automated rule that used the result

This gives your compliance team a clear record of what information was available when the decision was made.

KYW works best when it is connected to explicit rules:

• which transaction thresholds require KYW
• when non-custodial wallets require proof of ownership
• when unknown wallets should be blocked, reviewed, or allowed with extra information
• how long a KYW result can be reused before checking again
• which confidence levels are acceptable for automated decisions

For higher-risk transactions, combine KYW with transaction monitoring, sanctions checks, Travel Rule message status, and customer due diligence data.

• Introducing KYW - Know Your Wallet
• Wallet Intelligence technical integration guide
• Wallet Verification
• Get Wallet Intelligence API reference