Mastercard Secures Patents for Predicting Money-Laundering Risk Before Crypto Transfers

Mastercard has secured patents for technology that can assess money-laundering risk before a cryptocurrency transfer is executed and process transfers without exposing transaction details to outside parties, Digital Asset reported on November 6.

Mastercard received two patents from the U.S. Patent and Trademark Office on November 3 covering pre-processing for digital-asset transactions and privacy-preserving transaction processing, according to the report.

The first technology analyzes the sender’s and recipient’s past blockchain transaction records and then assumes a transfer has taken place to calculate in advance how much a user’s risk profile would increase. That would make it possible to identify risk before a transfer if a wallet is linked to illicit funds or sanctioned entities.

The second technology is designed to keep transaction information private among approved participants while a central authorization system checks balances and transfer conditions before deciding whether to approve the transaction. It is also designed to prevent double spending, in which the same funds are used more than once.

Last month, Mastercard introduced Stablecoin Security, a service that analyzes the source of funds and links to sanctioned entities before a stablecoin payment is made.