United

Mule

Armada

<p>Mastercard, a global leader in payment technology, is intensifying its efforts to detect and prevent fraudulent activities associated with cryptocurrency exchanges. In an exclusive announcement to CNBC, the company revealed its strategic partnership with Feedzai, a regulatory technology platform specializing in combating money laundering and online financial scams through artificial intelligence (AI).</p>
<h2 class="wp-block-heading" id="integration-of-feedzai-with-mastercard-s-ciphertrace-armada">Integration of Feedzai with Mastercard’s CipherTrace Armada</h2>
<p>As part of this collaboration, Feedzai will seamlessly integrate with Mastercard’s CipherTrace Armada platform, a tool designed to assist banks in monitoring transactions from over 6,000 cryptocurrency exchanges for signs of fraud, money laundering, and other suspicious activities. Unlike traditional API access, Feedzai will directly incorporate CipherTrace Armada into its technology, allowing for real-time alerts regarding potentially fraudulent cryptocurrency transactions.</p>
<p>Nuno Sebastio, CEO and co-founder of Feedzai, emphasized this integration’s significance, stating, “This will increase fraud detection by protecting unwary consumers, but will also detect potential money laundering activity and mule accounts.” Mule accounts are accounts exploited by fraudsters to launder ill-gotten funds.</p>
<p>Feedzai’s data suggests that approximately 40% of scam transactions originate from bank accounts and flow directly into cryptocurrency exchanges.</p>
<h2 class="wp-block-heading" id="mastercard-gains-access-to-feedzai-s-ai-expertise">Mastercard gains access to Feedzai’s AI expertise</h2>
<p>In addition to enhancing fraud detection capabilities, the partnership grants Mastercard access to Feedzai’s advanced artificial intelligence technology. Feedzai’s software can identify and block suspicious transactions within nanoseconds while recognizing legitimate ones.</p>
<p>Feedzai’s RiskOps platform analyzes transactions worth over $1.7 trillion annually, showcasing its robust capabilities in safeguarding financial systems. The company, headquartered in Coimbra, Portugal, and San Mateo, California, holds nearly 100 patents and consistently secures an average of 10 new patents yearly to protect its technology.</p>
<p>Sebastio also highlighted the importance of comprehensive cryptocurrency regulations, noting that many banks may unintentionally restrict only transactions involving recognized and regulated entities in the crypto space. At the same time, other potentially fraudulent activities go undetected.</p>
<h2 class="wp-block-heading" id="mastercard-s-move-towards-mainstream-crypto-legitimization">Mastercard’s move towards mainstream crypto legitimization</h2>
<p>Mastercard’s partnership with Feedzai represents a significant step in its efforts to legitimize cryptocurrency as a mainstream financial asset subject to the same rules and compliance frameworks as traditional assets. Banks and major financial institutions have increased interest in incorporating cryptocurrencies into their products and services.</p>
<p>However, the widespread adoption of crypto offerings has been hindered by concerns surrounding the lack of comprehensive regulations and the prevalence of fraud and scams. In 2022, crypto-related losses saw a global increase of 79% compared to the previous year, according to data from blockchain analysis firm Chainalysis. Illicit addresses received a staggering $14 billion in 2022, nearly double the amount received in 2020.</p>
<p>Mastercard’s extensive global network is utilized by banking institutions worldwide to process and monetize payments. The company competes in the payment technology sector with fellow industry giant Visa, which offers various financial technology services, including support for card payments.</p>
<p>In the United Kingdom, some banks have been cautious about associating themselves with cryptocurrencies. Several prominent lenders have halted transactions with crypto exchanges on their networks, citing concerns about fraud risks.</p>
<p>Leading banks such as JPMorgan, NatWest, and HSBC have restricted or blocked crypto transactions, drawing criticism from Coinbase CEO Brian Armstrong. Armstrong expressed his view that this development contradicted the UK’s ambition to become a global “Web3” hub, referring to the emerging decentralized internet.</p>
<h2 class="wp-block-heading" id="mastercard-s-focus-on-enhanced-security">Mastercard’s focus on enhanced security</h2>
<p>Ajay Bhalla, President of Cyber and Intelligence Solutions for Mastercard, highlighted the evolving risks and opportunities in the digital finance landscape, stating, “The interconnectedness of life today and increasing digital penetration of finance has brought risk as well as opportunity.”</p>
<p>Bhalla also noted that Mastercard’s data indicated that fraud in cryptocurrency transactions was five times higher than in regular fiat transactions. With the new partnership with Feedzai, financial institutions can differentiate between legitimate and suspicious transactions more effectively.</p>
<h2 class="wp-block-heading" id="building-on-previous-acquisitions">Building on previous acquisitions</h2>
<p>This partnership builds upon Mastercard’s earlier acquisition of CipherTrace, a U.S.-based blockchain sleuthing firm. In 2021, Mastercard purchased CipherTrace, and the following year, it launched its first product utilizing CipherTrace’s technology, known as **CryptoSecure**. This product is designed to analyze and block transactions from crypto exchanges with a history of fraudulent activities.</p>
<p>Mastercard’s collaboration with Feedzai represents a significant step in bolstering the security and legitimacy of cryptocurrency transactions. The partnership enhances fraud detection capabilities and provides Mastercard access to Feedzai’s advanced AI technology. As the digital finance landscape continues to evolve, the need for robust cybersecurity measures becomes increasingly vital, and this partnership is a testament to Mastercard’s commitment to ensuring the safety and integrity of financial transactions in the cryptocurrency space.</p>

Mastercard Partners with Feedzai to Combat Crypto Fraud with AI

Table of Contents

Cryptopolitan_News

Other articles published on Nov 20, 2023

Kronos Research Halts Operations After Losing $26 Million In Security Breach

Malaysian man falls victim to $200k crypto scam

Will Solana (SOL) Ever See $250 Again?

Tether Announces Its Largest Fund Freeze Ever

Worldcoin jumps 25% amid rumors of Altman’s return to OpenAI

Bitcoin Booms as U.S. Debt Bubble Threats to Burst: Is Crypto the Solution?

Join our free newsletter for daily crypto updates!