The latest offering from Mastercard enables financial institutions to identify and stop fraud on its network’s crypto merchant platforms.
On October 3, the financial services company Mastercard introduced a brand-new crypto solution pertaining to risk administration. The goal of Mastercard’s new service, Crypto Secure, is to assist banks in identifying and preventing fraud on platforms used by cryptocurrency merchants.
To assess the crime-related risks of cryptocurrency exchanges operating within the Mastercard network, Crypto Secure combines the use of artificial intelligence with blockchain data, public records of cryptocurrency transactions, and other sources.
A comparable service that accepts fiat money transactions is already offered by Mastercard to banks.
Ajay Bhalla, president of Mastercard’s cyber and intelligence division, stated that this innovation aids its partners in maintaining local regulatory compliance when battling fraud in the cryptocurrency space:
“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.”
When using Crypto Secure, banks and other Mastercard card issuers can view color-coded risk assessments of cryptocurrency merchants, which indicate the likelihood that the merchant would engage in fraudulent or suspicious activities.
CipherTrace, a blockchain security business based in California that was acquired by Mastercard the year before, runs Crypto Secure.
The program offers a higher level of advice on cryptocurrency transactions even though it doesn’t render judgments for banks. Currently, Mastercard’s network includes about 2,400 cryptocurrency exchanges.
Centralized payment processors like Visa and Mastercard have made crypto payments more widely accepted. Visa recorded over $1 billion in cryptocurrency spending last year, and Mastercard just introduced additional cryptocurrency payment options in places like Argentina and Indonesia.
The public’s awareness of cryptocurrency and related fraud and criminality is, nonetheless, growing. Data from Chainalysis shows that in 2021, cryptocurrency crime reached a new all-time high, with $14 billion being sent to fake wallet addresses.
Australian investors lost $242 million in 2022 as a result of investing and cryptocurrency-related frauds. While some business leaders have lately compared cryptocurrency to a Ponzi scheme, others are warning social media juggernauts about cryptocurrency frauds connected to their platforms.
