In the wake of charges against virtual currency firm Liberty Reserve S.A., earlier this week, Bitcoin exchange firm Mt. Gox announced that it will now require identity verification for currency transactions.

The U.S. Attorney’s Office for the Southern District of New York brought charges against Costa Rica-based Liberty Reserve and seven individuals earlier this week alleging that Bitcoins, a peer-to-peer virtual currency, are being used to facilitate money laundering.

Liberty Reserve ran US$6 billion money-laundering scheme, say U.S. prosecutors

On Friday, a prominent exchange for Bitcoins, Mt. Gox, announced that it is now requiring identity verification.

“The Bitcoin market continues to evolve, as do regulations and conditions of compliance for Mt. Gox to continue bringing secure services to our customers. It our responsibility to provide a trusted and legal exchange, and that includes making sure that we are operating within strict anti-money laundering rules and preventing other malicious activity,” it said.

So, starting May 30, all Mt. Gox user accounts must be verified in order to perform any currency deposits and withdrawals. Bitcoin deposits do not need verification, and, for now, neither do withdrawals. The firm noted that it has more than doubled its verification support staff in the past two months.

The allegations against Liberty Reserve have not been proven, but U.S. authorities are alleging that the anonymity it provides enabled fraudsters, hackers, and traffickers to use it to launder illicit proceeds. The U.S. Department of the Treasury also designated Liberty Reserve “a financial institution of primary money laundering concern”, and proposed rules banning financial firms from processing transactions involving the firm.