nSure.ai survey: KYC verified accounts count for 76 per cent of crypto fraud

The company is closely working with cryptocurrency exchanges to improve the security on their on-ramp transactions and allow them to remove unregulated parts of their friction-heavy KYC processes. In exchange, the overall onboarding process will be simplified and of lower friction, which will help companies that are onboarding large numbers of users, while trying to filter out and identify fraudsters.

Key findings of the research

According to nSure.ai, a staggering 87% of blocked transactions are triggered by first-time customers, hindering merchant acquisition efforts and increasing their marketing costs. Moreover, around 76.5% of fraudulent transactions come from KYC-verified accounts, which raises questions regarding the onboarding process and its efficiency in deterring fraudsters and scammers.

As a result of these strong fraudulent activities, merchants from various verticals – including crypto, fintech services, digital goods, and legacy payment fraud prevention companies – tend be increasingly cautious with the number of customers they onboard and decline many legitimate transactions, without understanding the reason they were red-flagged initially.

nSure.ai’s solution

To solve the problem of KYC onboarding, the Israeli-based company has developed a digital-good specific algorithm that combines user behaviour, multivariate anomaly detection, and contextual analysis to determine the legitimacy of a purchase. As a result, crypto purchasers will immediately benefit from a streamlined authentication process that will allow companies to recognize a higher transaction volume.