American payments services provider, Mastercard has announced the acquisition of blockchain intelligence and security services provider, CipherTrace. According to the official announcement, the terms of the deal were not made public, however, the acquisition will come off as a mutually beneficial move for both Mastercard and CipherTrace.
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CipherTrace provides crypto intelligence tools that help in tracking transactions that are on-chain easy. With the company’s solutions, digital currency transactions are no longer invincible and bad actors can easily be fished out for prosecution. The CipherTrace model helps numerous stakeholders in the cryptocurrency ecosystem including cryptocurrency exchanges, banks, and regulators to keep track of events in the space in a bid to guarantee adherence to regulations.
“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, CipherTrace. “Our two companies share this vision to provide security and trust throughout the ecosystem. We are thrilled to join the Mastercard family to scale CipherTrace’s reach across the globe.”
While the deal reinforces Mastercard’s reach to create a diverse alternation of moving value around the world, CipherTrace is positioned to benefit from the deep stretch of funding and industry reach that Mastercard will have to offer.
Building Trust in a Trustless World
The digital currency ecosystem is a trustless world, and the partnership between Mastercard is aimed at promoting trust in this nascent industry.
“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.”
The mainstream adoption of cryptocurrencies will continue to see a drawback when regulators or market watchdogs are unable to keep track of events in the space. The Mastercard and CipherTrace combo will attempt to allay the fears of authorities while helping to recreate standards upon which transparency in the digital currency ecosystem can be built.
The deal is expected to close by the end of the year.
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The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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The Decentralized Finance (DeFi) sector has witnessed an explosive growth this year. The total value locked (TVL) across all decentralized finance (DeFi) protocols has hit a new all-time high of $84 billion as August comes to a close, according to Data Aggregator DeFi Pulse.
Per ConsenSys’s Q2 2021 DeFi report, billions of institutional capital is flowing into DeFi. As the space is soaring to new heights, it is attracting significant attention from cyber criminals. The attacks on DeFi have become so regular that one protocol has developed a “DeFi REKT database.”
The CipherTrace database alleges that more than 2,500 projects have been ‘REKT’, and a cumulative of almost $474 Million has been lost to Ghostface killers in 2021.
While the overall cryptocurrency fraud rate has declined, DeFi-related frauds and hackings have increased significantly over the past few years. In 2021 alone, the DeFi hacks formed over 60% of the total hack and theft volume of crypto attacks, up by 40% from 2020, according to data from CipherTrace.
DeFi Exploit Outlook 2021
Very recently, Defi cross-chain protocol Poly Network fell prey to the biggest crypto heist in history. The hackers stole approximately $610 million worth of cryptocurrencies from Poly Network operating across the Binance Smart Chain (BSC), Ethereum (ETH), and Polygon. Thousands of people were affected by the hack, PolyNetwork said in a letter posted on Twitter. However, later on, the hacker returned the stolen amount.
Another major flash loan attack was encountered by the DeFi protocol, Cream Finance on August 30, when the lending protocol lost $18 million to scammers. According to early reports from Wu Blockchain, there were two attackers behind the exploit that carried out the heist in merely 17 transactions.
More money, more problems
Clearly, the DeFi industry is journeying onto maturity, and industry players are optimistic about its sustained growth. However, the DeFi sector has become a prime target for hackers. Many DeFi space projects are launched without being audited, and the ones which are audited often have attack vectors that go unnoticed.
Besides this, DeFi exchanges do not have any AML or KYC, so it is easy to execute an attack and launder the money through a DeFi exchange while the perpetrators will remain undetected.
Disclaimer
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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