Mastercard New Tool Aims to Combat Crypto Fraud
On October 3, Mastercard launched Crypto Secure, a new cryptocurrency-related service associated with risk management. A recent report suggests that this service will assist banks in preventing fraud by detecting and preventing crypto-related payments.
The artificial intelligence (AI) tool uses blockchain data, such as public records of cryptocurrency transactions, to determine fraud risks associated with cryptocurrency exchanges.
This service was developed in partnership with blockchain security startup, CipherTrace, an acquisition of Mastercard in 2021, and a company that develops crypto forensics, anti-money laundering, and blockchain threats intelligence software.?
This development helps Mastercard crypto partners stay compliant with local regulations, according to Ajay Bhalla, the president of Mastercard's cyber and intelligence business.
“The idea is that the kind of trust we provide for digital commerce transactions, we want to be able to provide the same kind of trust to digital asset transactions for consumers, banks, and merchants,” he said.
MasterCard already uses this system for its fiat transactions and is now expanding to other major cryptocurrencies, such as Bitcoin.
Digital asset crime is rising in the nascent digital asset market, which is why MasterCard is launching the service. Attacks on decentralized finance (DeFi) protocols increased by 1330% in 2021, and the number of hacks and frauds continued in 2022.
According to blockchain analytics firm Chainalysis, a record $14 billion in crypto has entered wallets with known criminal connections last year. As a result of high-profile hacks and scams targeting crypto investors, 2022 has been a challenging year for crypto investors.
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