On November 20, CNBC reported that financial services provider Mastercard announced a new partnership with artificial intelligence (AI) company Feedzai, the new AI tool to detect and prevent fraud routed through crypto exchanges.
Mastercard asserts that this integration will enhance its capacity to identify and thwart fraudulent activities that traverse cryptocurrency exchanges.
The integration between Feedzai and Mastercard’s CipherTrace Armada platform, which enables banks to monitor transactions from thousands of cryptocurrency exchanges for fraudulent or suspicious activities, will occur directly, according to the report.
Using artificial intelligence, Feedzai’s software detects and blocks dubious transactions in “nanoseconds.” Nearly 40% of fraudulent transactions, according to data from Feedzai, flow directly from bank accounts to cryptocurrency exchanges.
According to Feedzai’s CEO and co-founder Nuno Sebastio, the technology will “increase fraud detection by protecting unwary consumers” and “detect money laundering activity and mule accounts.”
“Numerous banks that believe they are preventing illegitimate cryptocurrency transactions are, in fact, only blocking transactions involving the widely recognized and regulated entities within the crypto space and omitting the rest.”
Mastercard introduced an additional AI-driven tool in July to assist financial institutions in combating fraud and payment schemes involving real-time transactions. This announcement comes shortly after that.
The provider of financial services has established itself in the Web3 and cryptocurrency sectors. Collaborating with prominent cryptocurrency exchanges, including Binance and Nexo, it has introduced Mastercards denominated in cryptocurrencies.
Mastercard has also recently participated in blockchain-based trials for central bank digital currencies (CBDCs). It declared a successful endeavor on October 12 with the Reserve Bank of Australia, the Digital Finance Cooperative Research Centre CBDC, Cuscal, and Mintable.