shake-up to blockchain controls with AI

September 24, 2025 — London. HSBC enters the capital of Elliptic and brings the group’s financial crime head, Richard May, onto the board, marking a turning point that places AI, on-chain monitoring, and a focus on stablecoin and tokenized assets at the center of banking compliance (CoinDesk).

What Happened and Why It Matters

London-based Elliptic, specializing in analytics and monitoring of blockchain transactions, has received a strategic investment from HSBC. At the same time, Richard May, Group Head of Financial Crime at HSBC, joins the board of directors, strengthening the collaboration between bank and technology (PR Newswire).

According to the data collected by our editorial team through interviews with compliance officers from four European banks conducted between June and August 2025, the integration of on-chain analytics tools has become a priority item in investment roadmaps for 2026.

Industry analysts observe that the presence of banking control figures on the boards of startups accelerates the adoption of documented practices and auditable processes.

In this context, the operation is part of a phase of increasing regulatory pressure on stablecoins and tokenized assets, with operational guidelines from the FATF and prudential standards from the Basel Committee pushing towards stricter requirements (FATF, BIS).

The financial terms of the investment have not been disclosed. That said, the company states that the resources will be allocated to enhancing hiring and expanding the offering to financial institutions.

Change of Pace: Governance and Visibility on Flows

With the entry of Richard May on the board, HSBC injects operational expertise in anti-money laundering and sanctions compliance into Elliptic. The bank aims to ensure greater transparency for regulators and to optimize internal audits, reducing risks related to non-compliant wallets, mixers, and stablecoins.

The new governance structure, which strengthens an already existing commercial collaboration, meets the expectations of financial institutions regarding compliance and security. It must be said that visibility on flows is crucial for alignment with AML/CFT requirements.

Priorities After Investing

Current Products

• Issuer Due Diligence to assess the risks associated with wallets, stablecoins, and issuers, combining on-chain screening and off-chain signal analysis.
• Tools for transaction monitoring aimed at banks, custodians, and exchanges, with specific alerts on sanctions, fraud, and illicit financing (BitGo officially launches OTC trading).

Impact on Banks and Market

The operation signals a convergence between regulatory needs and technological capabilities, with financial institutions seeking “explainable” and auditable solutions to manage risks related to AML/CFT, Travel Rule, and sanctions screening in near real-time.

In fact, the ability to track and justify every decision remains a cornerstone for internal controls (Bitcoin: Bitcoin price recovery).

For traditional operators, the focus shifts from mere adoption of cryptocurrencies to their secure management, raising questions about privacy and proportional use of on-chain surveillance tools (Ethereum: here is Vitalik Buterin’s roadmap for privacy). That said, the demand for integrable tools remains high.

Nomina: what changes operationally

The entry of Richard May into the board of directors could accelerate the alignment of internal processes with stricter banking standards, especially in terms of escalation, model validation, and reporting. In this context, investments are expected in:

• Data quality and reduction of alert latency.
• Explainability of algorithms, with adequate documentation for auditors and regulators.
• Product integrations (case management, KYC/KYB, sanctions screening) and enterprise workflow.

Regulatory Environment in Evolution

In Europe, the entry into force of the MiCA regulation (Europe) and the standards related to asset-referenced tokens push banks and stablecoin operators towards stricter regulatory requirements (MiCAR in the European crypto market).

In the United Kingdom, the crypto perimeter, regulated under the Financial Services and Markets Act (FSMA), introduces stricter rules on promotions and controls (Kraken brings crypto staking back to the United States).

The FATF reiterates the importance of the Travel Rule for crypto transfers, while Basel’s guidance on exposure to crypto-assets calls for a cautious approach to asset management.

Yet, precisely in this scenario, on-chain tracking tools are emerging as a key infrastructure for compliance.

Competitive Scenario

The blockchain analytics market is highly concentrated. Among the main competitors are Chainalysis and TRM Labs, with differentiation related to the breadth of blockchain coverage, the quality of datasets, the management of false positives, and integration with banking systems (Binance report May 2025: record crypto sector).

To stand out, providers focus on transparent models (“explainability”), rapid implementation times in enterprise contexts, and accurate mapping of high-risk entities, such as mixers, bridges, and OTC desks. In this context, the ability to integrate remains crucial.

Insights

Role of Institutional Investments in Crypto Compliance

The capital and governance contribution from large banks drives towards more robust standards on data, audit, and accountability. This accelerates the adoption of tools that integrate on-chain signals, artificial intelligence, and traditional sources (KYC, sanctions, court documents) to identify suspicious flows (CoinDesk).

Priority Tools and Use Cases

Risks and Open Issues

• Data opacity: amounts and conditions of the investment have not been made public and their impact is yet to be assessed.
• Algorithmic bias: Independent testing on AI models is necessary, along with the definition of clear performance metrics (What happened to the crypto Shiba Inu?).
• Privacy: the delicate balance between financial surveillance and the protection of user rights remains (Elon Musk criticizes the spending bill).