Mastercard, a leading player in the global payments industry, has announced a strategic partnership with Feedzai, a regulatory technology platform that utilizes artificial intelligence (AI) to combat money laundering and financial scams online. The move marks a major push from Mastercard into the market for legitimizing crypto as a mainstream financial asset that can be subjected to the same rules and compliance frameworks as traditional assets.
The partnership between Mastercard and Feedzai aims to improve the monitoring and blocking of fraud in crypto, with Feedzai integrating directly with Mastercard’s CipherTrace Armada platform. CipherTrace Armada is used to help banks monitor transactions from over 6,000 crypto exchanges for fraud, money laundering, and other suspicious activity. By integrating Feedzai’s AI-powered technology, Mastercard will be able to detect and prevent fraudulent activities in real time, protecting unwary consumers and preventing money laundering activity.
The tie-up between Mastercard and Feedzai is significant, given the growing concerns around crypto-related fraud and scams. According to data from blockchain analysis firm Chainalysis, the amount of theft and scams led to a global increase of 79% in crypto-related losses from the previous year. Compared to 2020, Illicit addresses received nearly twice as much in 2022—$14 billion.
Mastercard’s partnership with Feedzai is not its first foray into the crypto space. In 2021, Mastercard acquired CipherTrace, a U.S. blockchain sleuthing firm, and launched its first product using the firm’s technology, called CryptoSecure, to analyze and block transactions from fraud-prone crypto exchanges. The partnership with Feedzai builds on this existing technology, further enhancing Mastercard’s ability to detect and prevent fraud in the crypto space.
The move by Mastercard is also significant given the hesitation shown by banks in the U.K. to embrace crypto. The possibility of fraud has prompted a number of bigger lenders to stop allowing transactions with cryptocurrency exchanges on their networks. This has led to criticisms from Coinbase CEO Brian Armstrong, who said the development jarred with the U.K.’s ambition to become a global “Web3” hub. Mastercard’s partnership with Feedzai demonstrates its commitment to innovation and its willingness to invest in technology that can help legitimize crypto as a mainstream financial asset.
The partnership between Mastercard and Feedzai is also notable given the growing importance of AI in the financial services industry. AI-powered technology has the potential to revolutionize the way financial institutions detect and prevent fraud, and Feedzai’s RiskOps platform is at the forefront of this effort. The platform analyzes transactions worth over $1.7 trillion annually and can identify and block suspicious transactions in a matter of nanoseconds.
To put it simply, Mastercard’s collaboration with Feedzai is a noteworthy stride in the direction of establishing cryptocurrency as a respectable financial instrument. Mastercard will be able to identify and stop fraudulent behavior in real time by utilizing Feedzai’s AI-powered technology, shielding unwary customers and stopping money laundering. Partnerships like this one will be more crucial than ever in maintaining the integrity of the financial system as the cryptocurrency industry grows.
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