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Risk Level Categories

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🔴 High Risk

Addresses or transactions with confirmed or highly suspicious risk indicators. Characteristics:
  • Direct connections to known illicit activities
  • Sanctioned entities or individuals
  • Confirmed hacking incidents
  • Money laundering patterns
  • Darknet marketplace activity
Recommended Action: Block or flag for immediate review

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🟡 Generally High Risk (Medium Risk)

Addresses or transactions with moderate risk indicators that warrant further investigation. Characteristics:
  • Indirect connections to risky entities
  • Unusual transaction patterns
  • High-risk jurisdiction involvement
  • Newly emerged suspicious patterns
Recommended Action: Enhanced due diligence and monitoring

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🟢 Low Risk

Addresses or transactions with minimal or no risk indicators detected. Characteristics:
  • No direct connections to illicit activities
  • Normal transaction patterns
  • Established entities or individuals
  • Clean blockchain history
Recommended Action: Standard monitoring

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⚪ Whitelist

Addresses that have been verified and confirmed as safe through system-defined sources. Characteristics:
  • Addresses from compliant centralized exchanges
  • Institutional addresses with verified compliance
  • Well-known compliant funds
  • System-verified trusted entities
Recommended Action: Standard monitoring

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Risk Scoring Algorithm

Our risk scoring engine considers multiple factors:

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Direct Risk Factors

  • Known blacklist matches
  • Sanctions list matches
  • Confirmed scam reports
  • Law enforcement reports

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Behavioral Risk Factors

  • Transaction volume patterns
  • Counterparty connections
  • Jurisdiction risk
  • Entity type risk

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Network Risk Factors

  • Proximity to high-risk addresses
  • Chain analysis results
  • Fund flow patterns
  • Time-based patterns

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Risk Level in API Responses

Risk levels appear in various API responses:

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KYA Risk Assessment

{
  "success":true,
  "code":1,
  "msg":"SUCCESS",
  "data":{
    "time":1726107623669,
    "address":"13mnk8SvDGqsQTHbiGiHBXqtaQCUKfcsnP",
    "network":"btc",
    "whitelist": false,
    "risks":[
      {
        "riskLevel":"high",
        "riskType":"sanction",
        "riskSource":"Bitrace"
      }
    ]
  }
}

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KYT Transaction Screening

{
  "success":true,
  "code":1,
  "msg":"SUCCESS",
  "data":{
    "risks":[
      {
        "riskLevel":"low",
        "riskType":"scam"
      },
      {
        "riskLevel":"high",
        "riskType":"online-gambling"
      },
      {
        "riskLevel":"generally-high",
        "riskType":"launder-money"
      }
    ],
    "externalId":"87111618424664721806777127547213",
    "resultTime":1723542989406,
    "analyseStatus":true,
    "hash":"0xddeb5d1e29a88ac9e0a304f415628ff45f53c7278127de7f47c75b43bebcce8f",
    "value":1902.31608,
    "blockTime":1718669807000,
    "address":"0x974caa59e49682cda0ad2bbe82983419a2ecc400"
  }
}

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Risk Scores

Some endpoints provide numerical risk scores (0-100): 
{
  "success":true,
  "code":1,
  "msg":"SUCCESS",
  "data":{
    "scores":[
      {
        "address":"TFskN28dBDqv8tLKtM2GwroGx7bKDUSnBW",
        "score":"92",
        "riskBehavior": [
          {
            "riskType": "scam",
            "percent": "80"
          },
          {
            "riskType": "online-gambling",
            "percent": "5"
          }
        ]
      }
    ],
    "requestId":"26784916292200597542974738410940",
    "customId": "1234567",
    "status":1003
  }
}
Score Ranges:
  • 80-100: Severe Risk
  • 50-79: High Risk
  • 20-49: Medium
  • 0-19: Low Risk

Bitrace Model Score

More details on Guides

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Custom Risk Thresholds

You can implement custom risk thresholds based on your compliance requirements: 
function checkRisk(riskLevel, riskScore) {
  // Custom threshold logic
  if (riskLevel === 'high' || riskScore >= 80) {
    return 'BLOCK';
  } else if (riskLevel === 'generally-high' || riskScore >= 50) {
    return 'REVIEW';
  } else {
    return 'ALLOW';
  }
}

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Risk Level Updates

Risk levels are continuously updated as new intelligence emerges:
  • Real-time: High-priority risks (e.g., new hacks)
  • Daily: Medium-priority updates
  • Weekly: Comprehensive risk model updates

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Best Practices

  1. Layered Approach: Use both risk levels and risk scores for comprehensive assessment
  2. Context Matters: Consider risk levels alongside business context
  3. Regular Reviews: Periodically review medium-risk addresses
  4. False Positives: Report potential false positives to improve accuracy
  5. Compliance Alignment: Align your risk thresholds with regulatory requirements