Mastercard has announced a new partnership with Feedzai, an artificial intelligence company, to enhance its capabilities to detect and prevent cryptocurrency fraud.
- The collaboration will allow Mastercard to access Feedzai’s AI and machine learning technology to analyze crypto transactions in real time.
- Feedzai will integrate its platform directly with Mastercard’s CipherTrace Armada system to enable instant alerts on suspicious activity.
- Mastercard estimates that around 40% of scam transactions currently exit directly from a bank account to a crypto exchange.
The partnership details shared with CNBC come as Mastercard looks to increase oversight of the crypto sector. While the cryptocurrency realm is a booming sector, it remains prone to money laundering, scamming, and other illicit behavior.
Mastercard and Feedzai collaboration can ramp up crypto fraud detection
By teaming up with Feedzai, Mastercard aims to subject crypto transactions to the same compliance standards and safeguards as conventional banking and payments. Specifically, Feedzai’s technology will bolster Mastercard’s ability to:
- Detect fraud and scams, protecting consumers from losing funds
- Identify accounts used to launder money or facilitate other criminal activity
- Recognize legitimate transactions and avoid false positives
“This will increase fraud detection by protecting unwary consumers, but will also detect potential money laundering activity and mule accounts.”said Feedzai CEO Nuno Sebastio.
Feedzai analyzes over $1.7 trillion in transactions annually with its artificial intelligence software. The company claims its platform can identify suspicious transactions within nanoseconds while minimizing false alarms.
Mastercard’s CipherTrace Armada system currently monitors over 6,000 crypto exchanges for various risks. Integrating Feedzai will provide instant analysis of transaction data to identify red flags.
The collaboration reflects Mastercard’s efforts to bring crypto transactions into mainstream compliance frameworks. As cryptocurrencies see greater adoption, Mastercard aims to subject them to the same anti-fraud and anti-money laundering standards as traditional finance.