Mastercard has announced plans to purchase CipherTrace, a blockchain analytics company, as worldwide crypto regulation amps up.
Through its partnership with CipherTrace, a firm which analyses crypto transaction to check for suspicious activity, Mastercard aims to encourage the use of digital assets. Together, the companies will develop sophisticated monitoring tools to make crypto payments safer.
“Digital assets have the potential to reimagine commerce, from everyday acts like paying and getting paid to transforming economies, making them more inclusive and efficient,” said Ajay Bhalla, president, Cyber & Intelligence at Mastercard.
“With the rapid growth of the digital asset ecosystem comes the need to ensure it is trusted and safe. Our aim is to build upon the complementary capabilities of Mastercard and CipherTrace to do just this,” he added.
Crypto assets have long been plagued by an association with criminality.
In part, this reputation is well deserved. The anonymity supplied by the blockchain, which lets users transact via private keys, has made crypto a popular choice for criminals looking to conceal funds while scams in the crypto space are all too common.
Increasingly, regulators worldwide are catching up with the sophisticated use of blockchain by criminals and clamping down on illegal activity. Mastercard will be well placed to help regulators detect and prevent crime through their upcoming purchase.
The company has already made a number of high profile investments in crypto as part of efforts to encourage customers and businesses to transact using digital assets. Mastercard has partnered with Uphold, Gemini and BitPay to create crypto cards and teased plans to support the sale of stablecoins on its network.
Mastercard did not disclose how much the acquisition will cost, but the deal is expected to close by the end of the year.