Mastercard Launch ‘Crypto Secure’, a Crypto Fraud Detection Tool

Following the high rate of financial crimes bordering the crypto industry, giant financial service provider Mastercard has introduced a tool to fight against crypto fraud and financial crimes.

The crypto-related fraud-prevention solution dubbed Crypto Secure will be used to assess risk virtually by using sophisticated Artificial Intelligence (AI) algorithms and on-chain data.

Banks and card issuers can identify and block transactions from crypto exchanges that are susceptible to fraud.

The Crypto Secure tool is powered by Mastercard blockchain security startup CipherTrace which recently analyzed the percentage of cryptocurrency used for illicit activities. Also, the system will rely on data from the blockchain for its long record of crypto transactions.

CipherTrace is used by businesses and government entities to probe illegal transactions involving digital assets.

Its rivals in the industry are crypto analytic firm Chainalysis and London-based blockchain analysis provider Elliptic. The financial institutions will be able to monitor and trace the transactions through the Crypto Secure dashboard

A display of colored-coded ratings describing the severity of the risk of illicit activities is shown on the dashboard. Green is the lowest level while red shows a very high risk of exposure to suspicious crypto operations. As Crypto Secure shows this result, it does not have the responsibility of turning away suspected crypto merchants. This responsibility lies solely in the hands of the card issuer or the financial institution.

Mastercard Encourage Crypto Regulation

Mastercard already has a similar procedure for preventing fraud for fiat currencies.

It is only using Crypto Secure to extend the function to Bitcoin (BTC), Ethereum (ETH), and other cryptocurrencies. Mastercard’s President of Cyber and Intelligence Business Ajay Bhalla said the new invention is to ensure that partners are aligned with the industry regulatory framework.

“The whole digital asset market is now a pretty large, substantial market,” he said “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.”

Bhalla also spoke on the effect of the current bearish crypto market on this new strategy introduced by Mastercard. He said “These are market cycles, they will come and they will go. I think you’ve got to take the longer view that this is a big marketplace now and evolving and is probably going to be much, much bigger in the future.”