AML stands for Anti-Money Laundering measures, which are put in place to prevent illicit activity such as money laundering and terrorism financing within the cryptocurrency industry. These measures are implemented to ensure that individuals and entities engaging in cryptocurrency transactions are not using them for illegal purposes.

Cryptocurrency exchanges and other service providers are required to comply with AML regulations to verify the identities of their customers, monitor transactions for suspicious activity, and report any suspicious transactions to the relevant authorities. Failure to comply with AML regulations can result in fines and legal repercussions for the service providers.

By implementing AML measures, regulators aim to create a safer environment for cryptocurrency users, protect the integrity of the financial system, and prevent criminals from exploiting cryptocurrencies for illegal activities. These measures help to build trust in the cryptocurrency industry and promote its legitimacy in the eyes of the public and regulators alike.