AML (anti-money laundering) is the overall set of rules and controls. KYC (know your customer) checks who a person is. KYT (know your transaction) checks where money in a specific transfer came from and where it goes. Exchanges use all three; an AML wallet check is a form of KYT you can run yourself.
The three terms
| Term | Question it answers | Example |
|---|---|---|
| AML | How do we stop criminal money moving through us? | Policies, monitoring, reporting suspicious activity. |
| KYC | Who is this customer? | ID document, selfie, proof of address. |
| KYT | Where did this money come from, and where is it going? | Screening a deposit address for scam or sanctions exposure. |
What does KYT mean?
KYT stands for “know your transaction”. It is the transaction side of AML: instead of checking who a customer is, it checks the money — the addresses a transfer comes from and goes to, and whether they are linked to sanctions, scams, stolen funds, mixers or other risky sources. Exchanges run KYT automatically on deposits and withdrawals, usually with a blockchain analytics provider; in crypto the terms “KYT”, “transaction monitoring” and “wallet screening” are often used for the same job.
Who has to do it
The FATF’s standards require virtual asset service providers to apply the same preventive measures as financial institutions — customer due diligence, record keeping and suspicious transaction reporting — and countries to license or register them.[1] In the US, FinCEN’s 2019 guidance explains how money-transmitter rules apply to businesses that accept and transmit convertible virtual currency.[2] In the EU, crypto-asset service provider rules under MiCA apply from 30 December 2024.[3]
What it means for you
- KYC is why an exchange asks for your passport.
- KYT is why a deposit can be held: the exchange screens where it came from.
- An AML wallet check lets you run a KYT-style screen on a counterparty before you accept their coins. Compare tools in our rankings; businesses can see KYT providers.
This guide is general information, not legal or financial advice. Rules differ by country and change; check the linked sources.
FAQ
What is KYT in crypto?
KYT (know your transaction) is the screening of crypto transfers: where the coins in a transaction came from and where they are going, and whether those addresses are linked to sanctions, scams or other illicit activity.
Is KYT only for businesses?
Full transaction monitoring is a business tool, but individuals can run one-off address checks with consumer services.
Does KYC make an exchange safe from AML problems?
No. KYC checks the customer; KYT checks the money. Both are needed.
Sources
- FATF — Virtual Assets. Checked 4 Nov 2026.
- U.S. Treasury, Financial Crimes Enforcement Network (FinCEN) — Application of FinCEN's Regulations to Certain Business Models Involving Convertible Virtual Currencies (FIN-2019-G001) (9 May 2019). Checked 4 Nov 2026.
- European Securities and Markets Authority (ESMA) — Markets in Crypto-Assets Regulation (MiCA) (30 Dec 2024). Checked 4 Nov 2026.