Mastercard is launching a system to assess the risk of criminal association with cryptocurrency exchange on its payment network.
The Crypto Secure platform is powered by artificial intelligence (AI) algorithms, harnessing on-chain data derived from blockchains, among other sources.
Its intended users are banks and financial institutions, who are presented with a dashboard that provides color-coded ratings representing different levels of suspicious activity, from green meaning “low,” to red indicating “high” risk.
Crypto Secure provides no other commentary, leaving the decision to accept a prospectively suspicious crypto merchant to the platform’s users.
Crypto crime now a $14 billion business
Mastercard said it was launching the service in light of the growing number of crimes that have been perpetrated as cryptocurrency adoption swelled over the past year.
Some $14 billion worth of cryptocurrencies flowed into digital wallets associated with illegal acts last year, according to data from blockchain analytics firm Chainalysis.
This year has also seen its fair share of high-profile cryptocurrency hacks and scams. Chainalysis recently reported that a surge in stolen funds from decentralized finance (DeFi) protocols had sent losses from cryptocurrency hacks soaring nearly 60% between Jan. and July 2022.
During this period stolen funds from cryptocurrency hacking totaled $1.9 billion, up from $1.2 billion during the same period last year, according to Chainalysis data.
Powered by newly-acquired startup
Crypto Secure will be powered by blockchain security startup CipherTrace, which Mastercard acquired one year ago to bolster its crypto-related security.
Using its innovative data analytics and algorithms, the Menlo Park-based company helped businesses and government agencies investigate illicit transactions involving cryptocurrencies.
In addition to New York-based Chainalysis, CipherTrace also counts London-based Elliptic among its rivals.
Mastercard’s CipherTrace acquisition had followed a number of similar investments the company had made in its digital assets’ sphere.
These included the creation of crypto cards through partnerships with Uphold, Gemini and BitPay, in addition to creating new platforms to test and support non-fungible tokens, stablecoins and even central bank digital currencies.
Disclaimer
In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.
