Mastercard to Acquire CipherTrace

The credit card corporation intends to complete the acquisition before the end of the year in order to “improve” its crypto capabilities and gain visibility into the more than 900 coins monitored by CipherTrace.

Mastercard is expanding its reach into the world of digital assets with the announcement on Thursday of a new agreement to purchase crypto intelligence startup CipherTrace. The credit card corporation intends to complete the acquisition before the end of the year in order to “improve” its crypto capabilities and gain insight into the more than 900 cryptocurrencies now monitored by CipherTrace, a US Department of Homeland Security-funded project.

The agreement would enable MasterCard customers and stakeholders to leverage and benefit from CipherTrace’s products as consumers “develop their own virtual asset offerings,” according to the company.

CipherTrace was launched in 2015 and claims to have performed “blockchain forensics” for over 150 of the world’s major banks, exchanges, financial institutions, and regulators spanning over 7,000 cryptocurrency businesses. The company stated that its objective is to safeguard financial institutions from dangers associated with virtual asset laundering and crypto-related threats, while also increasing the blockchain economy by making it safer for users and more trusted by the government.

“We help companies – whether they are banks or cryptocurrency exchanges, government regulators or law enforcement to keep the crypto economy safe,” said Dave Jevans, CEO of CipherTrace. “Our two companies share this vision to provide security and trust throughout the ecosystem.”

As digital assets such as cryptocurrencies and non-fungible tokens (NFTs) gain traction, they will require solutions and increased intelligence to scale the crypto ecosystem with the same level of trust and security enjoyed by traditional payment methods, Mastercard said.

“Digital assets have the potential to redefine commerce, from routine transactions such as paying and receiving to altering economies and making them more equitable and efficient,” said Ajay Bhalla, Mastercard’s VP of Cyber and Intelligence. “As the digital asset ecosystem expands at a breakneck pace, it is critical to assure its trustworthiness and security. Our objective is to accomplish this by using the complementary capabilities of Mastercard and CipherTrace.”

Mastercard said the integrated offering will leverage CipherTrace’s suite of digital assets and Mastercard’s cyber security solutions to increase transparency in recognizing and assessing threats and to assist businesses in meeting regulatory and compliance requirements.

CipherTrace stated that it will continue to collaborate with financial technology companies, cryptocurrency wallet providers, governments, and other groups. “This purchase furthers Mastercard’s objective in the digital assets field, which is to empower customers, merchants, and companies have more choice in how they move digital value,” the company stated. Mastercard also announced a deal to purchase Aiia, a European open banking technology startup, earlier this week.

“The addition of Aiia anchors our European open banking efforts and allows us to continue to meet our customers where they are,” said Craig Vosburg, chief product officer at Mastercard. “As open banking continues to ignite innovation, we’re committed to providing a unique set of technology platforms, data connectivity and infrastructure combined with data privacy and security principles,”

Mastercard added seven businesses to its engagement program in July, Blockworks previously reported. The initiative is focused on aiding fast-growing digital assets, blockchain, and cryptocurrency enterprises as the payment major continue its push into the field.

Mastercard has made a number of investments, including partnerships with Uphold, Gemini, and BitPay to develop crypto rewards cards, the development of new platforms to test and support potential Central Bank Digital Currencies, as well as programs to support blockchain technology and NFTs, and the potential to directly support select stablecoins on the company’s network, the company said.

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