Mastercard launches new product to help banks combat crypto-related crime
According to an Oct. 4, 2022 report, Mastercard has announced that it will debut a software product that will help banks detect fraudulent transactions and block them from going through crypto exchanges.
A new product, Crypto Secure, leverages “sophisticated” synthetic intelligence algorithms to assess the risk of crime associated with crypto exchanges on the Mastercard payment network. The software runs on his CipherTrace blockchain, which integrates artificial intelligence, cyber, and blockchain capabilities to provide cryptocurrency stakeholders with digital asset security and fraud solutions. Mastercard has acquired the company behind CipherTrace on October 19, 2021.
When banks and other card issuers use the Crypto Secure platform, they are presented with a dashboard that presents a color-coded rating representing the severity of risk associated with cryptocurrency transactions and activities. Red indicates a high level of risk and green indicates a low level of risk.
However, Crypto Secure does not determine or advise users of the Crypto Secure platform on how to handle cryptocurrency transactions, leaving the decisions up to the users.
Crypto Secure aims to help banks and card issuers meet their compliance obligations
Crypto Secure builds on Mastercard’s existing technology to combat fraud in fiat currency transactions.
The product is designed to help stakeholders manage their compliance obligations in a “complex regulatory environment,” and is designed to foster trust in digital asset transactions among consumers, banks and merchants. Ajay Bhalla, President of Cyber and Intelligence Business at Mastercard, explains.
Current Crypto Regulation Status
Compliance is becoming increasingly important as cryptocurrency adoption increases among large financial institutions and popular retailers. Cryptocurrency compliance is the process of following anti-money laundering regulations (AML) by integrating tools and internal processes when working with cryptocurrencies. This may include KYC, transaction tracking, or filing reports with regulatory agencies.
The Biden administration introduced the first-ever cryptocurrency regulatory framework on September 16, 2022, and the European Union approved its own landmark crypto regulation.
Billed as “Ensuring the Responsible Development of Digital Assets,” Biden’s Crypto Regulatory Framework protects consumers, prevents crypto-related crime, thwarts fraud, and convenes government agencies to keep the crypto space accountable. emphasized the need to ensure progress with Also highlighted was the U.S. Central Bank’s Digital Currency (CBDC) investigation.
On June 30, 2022, the EU Council and the European Parliament reached an interim agreement on a new crypto regulation, Markets in Crypto-Assets (MiCA). -Asset Service Providers (CASP) under the framework for the end of 2022.
Under the new regulations, CASPs are allowed to operate within the region and must comply with requirements to protect consumer wallets. The regulation also requires stablecoin issuers to maintain sufficient reserves to meet redemption demands in the event of large withdrawals.
