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Payments giant Mastercard Inc on Thursday said it has acquired crypto intelligence firm CipherTrace, for an undisclosed amount to protect its customers and comply with regulations as they start to build out their digital currency offerings.
The California-based CipherTrace develops tools that help businesses and law enforcement to scan blockchains and root out illicit transactions and will give Mastercard the ability to track over 900 cryptocurrencies.
Earlier this year, CipherTrace raised $27 million from a Series D funding round led by Daniel Loeb’s Third Point Ventures valuing the firm $100 million.
“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,” Ajay Bhalla, president of cyber and intelligence at Mastercard, said in a statement.
After the announcement, Mastercard shares were up about 0.6% Thursday morning in New York.
A major concern with digital currencies is their decentralized nature, making them the choice of cybercriminals. The anonymous transactions are forcing the governments, banks and other companies to ramp up monitoring and compliance.
The blockchain is a public ledger of all crypto transactions, and services like CipherTrace scrutinize fund transfers to determine whether they’re dubious.
“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,” Bhalla said.
The deal is the latest sign of corporates showing interest in the crypto market. Mastercard itself said it would open its network up to select cryptocurrencies this year,
Mastercard has been ramping up its crypto efforts as the payment giant in July said it would be piloting the use of the USDC as a bridge between digital currency users and merchants who wants to stick to traditional currency and is planning to let merchants accept crypto through its network by year’s end.
“Our philosophy on cryptocurrencies is straightforward: It’s about choice,” Mastercard’s crypto VP, Raj Dhamodharan, said at the time. “Mastercard isn’t here to recommend you start using cryptocurrencies. But we are here to enable customers, merchants, and businesses to move digital value.”
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