Mastercard Partners with Feedzai to Combat Fraud in Crypto Transactions
Mastercard has taken a significant step in its efforts to combat fraud in cryptocurrency transactions by partnering with Feedzai, a regulatory technology platform specializing in using artificial intelligence (AI) to identify fraudulent payment transactions and minimize risk in the financial services, retail, and e-commerce industries.
How Feedzai Helps Detect and Prevent Fraud
Feedzai develops AI and machine learning algorithms designed to detect and prevent various types of financial fraud. Its technology can analyze transactions in real-time, process large volumes of data, provide customizable solutions for different businesses, assist in risk management, and ensure compliance with regulatory requirements.
Integration with Mastercard’s CipherTrace Armada Platform
The partnership will see Feedzai’s technology directly integrated with Mastercard’s CipherTrace Armada platform, which monitors transactions from over 6,000 cryptocurrency exchanges. This integration enables real-time alerts on suspicious crypto transactions, helping to identify potential fraud, money laundering, and other illicit activities.
Protecting Consumers from Fraud
Nuno Sebastio, CEO and co-founder of Feedzai, emphasized that approximately 40% of scam transactions currently move from bank accounts to crypto exchanges. The collaboration aims to protect consumers from fraud and identify potential money laundering activities by leveraging AI technology.
Legitimizing Cryptocurrency as a Mainstream Asset
This partnership reflects Mastercard’s broader push to legitimize cryptocurrency as a mainstream financial asset subject to regulatory and compliance frameworks. Despite the interest from banks and financial institutions in incorporating crypto into their services, regulatory uncertainties and associations with fraud remain challenges for the deployment of commercial crypto products.
Competition and Risk Mitigation
Mastercard’s vast network places it in direct competition with Visa and other fintech service providers. The partnership with Feedzai will enable Mastercard to distinguish legitimate transactions from fraudulent ones more effectively, addressing the heightened risk of fraud in crypto transactions compared to regular fiat transactions.
Hot Take: Mastercard Takes a Stand Against Fraud in Crypto Transactions
Mastercard’s collaboration with Feedzai represents a significant step in combating fraud in cryptocurrency transactions. By leveraging AI technology, this partnership aims to protect consumers from fraud, identify potential money laundering activities, and legitimize cryptocurrency as a mainstream financial asset. With the integration of Feedzai’s technology into Mastercard’s CipherTrace Armada platform, real-time alerts on suspicious crypto transactions will become possible. This move by Mastercard not only positions it as a direct competitor to Visa but also demonstrates its commitment to mitigating the risks associated with crypto transactions. As more banks and financial institutions explore crypto services, partnerships like this are crucial for building trust and fostering the adoption of cryptocurrencies.
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