Traditional compliance tools are reactive, opaque and difficult to audit. As more assets move onchain and are managed by AI agents and automated systems, it has become increasingly important to prevent risky transactions before they happen.

Today, we’re introducing the Magic Labs Risk Scoring Data Oracle, the first of many open-source implementations that integrate data from third party providers into pre-transaction compliance policies on Newton Protocol.

Bringing Magic Labs Risk Data into Newton Protocol

The Magic Labs Risk Scoring Data Oracle integrates Magic Labs’ wallet and email risk intelligence — derived from seven years of transaction data across 50M+ wallets and enriched with OFAC sanctions and public datasets — to enable pre-transaction compliance. Each wallet or email address receives a risk score that developers can use with Newton Protocol policies to determine whether an action proceeds.

With Newton Protocol, developers can integrate Magic Labs’ industry leading risk data to enforce policies for myriad use cases:

  • AI trading agents: Prevent agents from transacting with OFAC sanctioned or high-risk wallets.
  • Stablecoin and RWA issuers: Block mints or redemptions tied to elevated-risk entities.
  • DeFi lenders: Dynamically adjust borrowing limits or collateral ratios based on wallet risk tier.
  • Wallets and payment apps: Require additional KYC or multi-sig confirmation for medium-risk users.
  • Custodians and DAOs: Publish onchain attestations proving that counterparties have passed risk screening before interacting with treasury or governance contracts.

Why Newton Protocol Is Different

Centralized compliance systems risk downtime, and other decentralized compliance engines hardcode policy logic into smart contracts. Unlike existing solutions today, Newton Protocol solves these problems by separating policy logic from smart contract execution without sacrificing decentralization. 

This architecture allows developers to implement compliance and risk policies that are:

  • Modular: Define once, apply across multiple contracts or chains.
  • Composable: Combine onchain and offchain data for richer logic.
  • Updatable: Adjust rules as regulations or data sources evolve; no smart contract redeployment needed.
  • Verifiable: Every evaluation produces a cryptographic attestation viewable via the Newton Explorer.
  • Credibly Neutral: Policies are evaluated by a decentralized operator network secured by EigenLayer restaking.

Newton Protocol offers compliance-as-code, giving teams of any size access to the security and risk management controls used by institutions. For developers without a dedicated risk team, Newton Protocol can be integrated with any risk and compliance data provider to help ensure every transaction meets key global standards such as OFAC, AML/CFT, MiCA and SEC regulations.

Get Started

Developers can now use the Magic Labs Risk Scoring Data Oracle to enforce real-time wallet and email screening before risky transactions occur.

Head to the Developer Docs to learn how to integrate Magic Labs’ risk scoring and other data like KYC, historical yields, and more into Newton Protocol policies. With Newton Protocol, developers can mix and match data from multiple sources to design policies that meet business or regulatory requirements.

About Magic Labs

Magic Labs provides the leading embedded wallet and identity infrastructure for web3, trusted by over 200,000 developers and major brands like Naver Financial, Polymarket, WalletConnect, and more. Its HIPAA, SOC 2 Type II and ISO 27001:2022-certified platform ensures enterprise-grade security, compliance, and reliability for applications integrating digital identity and onchain transactions.

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About Newton Protocol

Newton Protocol is a decentralized policy engine that transforms business logic into programmable infrastructure. Developers can define, verify, and enforce policies that enable real-time, privacy-preserving compliance and guardrails for RWA, DeFi, and AI systems.

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