Transaction monitoring involves the process of tracking and analyzing transactions conducted using cryptocurrencies to ensure compliance with legal and regulatory requirements. This practice aims to detect illicit activities such as money laundering, fraud, and terrorist financing. By examining the patterns and behaviors of transactions, organizations can identify suspicious activities and take appropriate action. Monitoring tools often include algorithms that analyze transaction data in real-time. These tools can flag unusual transaction sizes, frequency, or source and destination addresses that have been linked to known illegal activities. Companies that operate within this space use transaction monitoring to protect themselves from regulatory penalties and enhance their security measures. They ensure that their operations align with anti-money laundering (AML) and know your customer (KYC) guidelines. As cryptocurrency becomes more mainstream, effective transaction monitoring is essential for maintaining trust and integrity in monetary systems.