Transaction Screening

Transaction Screening (available as Beta) is a real-time tool that automatically checks blockchain transactions and associated addresses for risks related to sanctioned entities, terrorist financing, or other suspicious behaviors. This is a core component of the Compliance Engine and it allows developers to configure screening rules to meet the specific compliance requirements of their jurisdiction or industry.

Developers can trigger screening evaluations using two methods:

• Embedded, where screening occurs implicitly during regular programmable wallet transaction flow.
• Standalone, where screening is triggered explicitly through the Compliance API.

Features

• Custom Rules: Tailor your own screening rules to match your specific use and regulatory requirements.
• Blocklist/Whitelist: Developers can specify blacklisted or whitelisted addresses, enhancing control over transactions and minimizing the chance of interacting with known bad actors.
• Real-Time Alerts: The system provides immediate notifications when a transaction violates pre-set screening rules. Alerts can trigger actions such as blocking a transaction, freezing a wallet, or sending it for further manual review.
• Detailed Logs and API Integration: Developers can access detailed logs and results of screened transactions, enabling easier auditing and review. The system also offers a robust API for integrating screening functionality into existing workflows.

API Overview

Embedded screening

For Programmable Wallets using embedded screening, the existing Get a transaction API endpoint includes a response field, transactionScreeningEvaluation, for transaction screening result, detailing:

• Rule found during screening
• Actions taken for the decision
• Reasons for the decision, related risk signals found during the screening: source, risk score, risk category, etc.

Standalone screening

For Programmable Wallet developers using standalone screening, the Compliance Engine exposes a new Screen a blockchain address API endpoint, enabling you to screen a specific blockchain address on a given supported chain independently of any transaction flow. The endpoint response returns the following:

• Screening result: High level of the screening result, either APPROVED or DENIED.
• Screening decision: Same information as the transactionScreeningEvaluation field above.
• Detailed vendor response: Findings from vendors to provide a deeper understanding of the screening results and their source. Note: values will only be available on testnet for the test cases provided on the Testing Guide.

Workflow

On testnet, transaction screening is enabled by default. For mainnet access, you will need to request access via the Circle Console. Then:

1. Customize your screening rules via the console to match your own risk and compliance requirements:
   a. Check the Compliance Engine whitepaper (Part 3) for some helpful questions to consider when establishing your requirements.
   b. Check the Rule Management guide for possible configurations.
2. Trigger a screening evaluation:
   a. Through the Screen a blockchain address API endpoint.
   b. Through generating an on-chain transaction via the Transactions API.

You can review detailed results for all rule matches and alerts on the Circle Console.