The announcement of KPMG Canada’s partnership with Chainalysis coincides with broader industry efforts to address fraud associated with cryptocurrencies.
KPMG Canada has announced a strategic partnership with blockchain analytics firm Chainalysis in response to growing threats of exploits and fraud within the crypto sector.
Kunal Bhasin, Partner and Co-Leader of crypto Assets and Blockchain at KPMG Canada, crypto-frauds-and-exploits/” target=”_blank” rel=”nofollow noopener”>emphasized that “this collaboration will help further solidify KPMG’s expertise in forensic investigations and crypto assets and blockchain technology.”
The approach of KPMG Canada and Chainalysis
As the digital asset ecosystem expands, so does the threat of fraud and criminal activities. The decentralized and pseudonymous nature of blockchain technology has made it an attractive platform for illicit activities such as money laundering, ransomware attacks, and fraud.
Companies operating in the digital asset space face the difficult task of safeguarding their platforms and transactions against these evolving threats. According to the Chainalysis crypto Crime Report 2023, the volume of illicit cryptocurrency-based transactions reached an unprecedented $20.6 billion last year.
In particular, the sector faces increasingly sophisticated threats, such as wallet hacks and SIM swaps. In a recent high-profile incident, crypto exchange Poloniex lost approximately $114 million when hackers attacked its hot wallets. In addition to Poloniex, other platforms also suffered one form or another of exploitation over the past year.
In response to these growing threats, KPMG, a renowned global consulting giant, is leveraging its expertise to strengthen the defenses of companies operating in the crypto ecosystem. Through this strategic partnership, KPMG aims to provide comprehensive solutions to identify, prevent and mitigate fraud risks associated with digital assets.
The collaboration is not only aimed at preventing fraud but also ensuring regulatory compliance within the digital asset sector. As governments around the world struggle to develop appropriate regulations for the growing cryptocurrency market, companies face the challenge of aligning their operations with evolving compliance standards. The collaboration, therefore, seeks to improve its Anti-Money Laundering (AML) compliance processes.
Industry-Wide Collaboration Against crypto Fraud
Meanwhile, the announcement of KPMG Canada’s partnership with Chainalysis coincides with broader industry efforts to address fraud associated with cryptocurrencies. Mastercard Inc (NYSE: MA), in a recent report, revealed its partnership with Feedzai, a regulatory technology platform that employs artificial intelligence to combat money laundering and online financial fraud.
Through this collaboration, Feedzai will integrate with Mastercard’s CipherTrace Armada platform, monitoring transactions from over 6,000 crypto exchanges for potential fraud, money laundering, and other suspicious activity.
Surprisingly, KPMG Canada has been actively involved in the cryptocurrency sector, demonstrating its dedication to the adoption of emerging technologies. Last year, the company entered the metaverse by establishing its first collaboration center between its US and Canadian units.
Additionally, KPMG added bitcoin (btc) and ethereum (eth) to its balance sheet, demonstrating a forward-thinking approach to incorporating digital assets into traditional financial strategies. The company also ventured into the non-fungible token (nft) space, purchasing digital art from the World of Women (WoW) nft collection.
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