Mastercard To Buy Crypto Tracing Firm CipherTrace

Payment giant, Mastercard, has recently made a deal with an anti-money laundering company that scans blockchains for illicit transactions. The company, CipherTrace struck the deal with Mastercard on Thursday, which comes after the payment giant announced that it would start supporting selected cryptocurrencies directly on its network this year. 

This acquisition will Mastercard the ability to track over 900 cryptocurrencies. Further details of the acquisition have not been disclosed. 

The deal between Mastercard and CipherTrace is the latest sign of significant activity in the tracing sector ad governments and banks around the globe are seeking ways to ramp up crypto monitoring and compliance. 

CipherTrace is a big player in the anti-money laundering world. Earlier this year, Daniel Loebs’ third-point venture lead to a $27 million investment into the company however, the firm is still valued less than competitor, Chainalysis- which is valued at $4.2 billion. 

Ajay Bhalla, President of Mastercard Cyber and Intelligence said, “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.”

Mastercard has been increasing its crypto efforts recently. In July, the company said that it would be piloting the use of circle-administered USD coin as a bridge between their crypto-using buyers and merchants, who largely accept cash. In February, Mastercard said that it would start allowing merchants to accept payments in crypto by the end of the year

At the time, Mastercard’s crypto Vice president said, “Our philosophy on cryptocurrencies is straightforward: It’s about choice.”

“Mastercard isn’t here to recommend you start using cryptocurrencies. But we are here to enable customers, merchants and businesses to move digital value.”

Mastercard has bought into CipherTrace to help monitor the crypto transactions that will soon take place through its software. CipherTrace can be used to detect fraud, expand existing crypto strategy and drive innovation. Securing such as deal is a huge signpost that Mastercard may be accepting crypto payments sooner than we think! 

Mastercard is not the only payment company with a crypto strategy underway. Visa is also in the midst of creating its own crypto strategy and the two rival cards are expected to compete when the strategies are eventually rolled out. 

Previously, Visa has held a strong dominance in the cryptocurrency industry however, Mastercard is catching up by making a number of crypto-related investments. Mastercard has also partnered with Uphold, Gemini, and Bitpay to create crypto cards and support USDC payments on its network.