Mastercard Bolsters Crypto Fraud Detection With Artificial Intelligence

By TheNewsCrypto
7 months ago
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  • Feedzai’s software was developed to detect and prevent fraudulent financial transfers.
  • This follows Mastercard’s announcement in July of the launch of a new AI-powered tool.

Financial services giant Mastercard has announced a new cooperation with AI startup Feedzai. Mastercard said the association intends to increase its capacity to recognize and avoid fraud channeled via cryptocurrency exchanges.

The report claims that Feedzai will soon be directly connected with Mastercard’s CipherTrace Armada platform, a banking tool that monitors thousands of cryptocurrency exchanges for fraud and other suspicious activity.

Improvised Fraud Detection

Feedzai’s software was developed to detect and prevent fraudulent financial transfers in “nanoseconds” using AI. Feedzai reports that roughly 40% of fraudulent transactions involve transfers from traditional financial institutions to cryptocurrency exchanges.

Co-founder and CEO of Feedzai, Nuno Sebastio, believes their method will improve fraud detection by shielding naïve customers from scams and can also spot instances of money laundering and mule accounts.

The CEO further added:

“Numerous banks that believe they are preventing illegitimate cryptocurrency transactions are, in fact, only blocking transactions involving the widely recognized and regulated entities within the crypto space and omitting the rest.”

This follows Mastercard’s announcement in July of the launch of a new AI-powered tool designed to assist banks in combating fraud and real-time payment schemes.

The supplier of financial services is well-known in the Web3 and cryptocurrency communities. It has partnered with major cryptocurrency exchanges like Nexo and Binance to create cryptocurrency-based Mastercards.

As of late, Mastercard has been testing the feasibility of blockchain-based tokenization of central bank digital currencies (CBDCs). The effort, which included Cuscal and Mintable, was revealed on October 12 and was conducted in tandem with the Reserve Bank of Australia and the Digital Finance Cooperative Research Centre CBDC.

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