Identity fraud attempts double in wake of Bitcoin price surgeA study by Onfido has revealed the doubling of identity fraud attempts in February 2021, coinciding with the five times year-on-year surge in the price of Bitcoin
The doubling in identity fraud attempts follows the ongoing trend of fraudsters taking advantage of the rise in remote working and reliance on digital-first services, with the recent Onfido Identity Fraud report revealing an increase of 41% over the previous year.
With the crypto market emerging as a regular hotbed for identity fraud, Onfido’s findings show the importance of vigilant identity verification solutions that detect and prevent attacks and scale with demand.
Many useful solutions of this kind utilise a combination of AI and identity experts to enable timely access to legitimate customers who wish to invest and trade securely in the crypto market.
How combining AI and humans can help to tackle cyber fraud
“The pandemic has led to a significant rise in unsophisticated identity fraud as first-timers look to take advantage of unsuspecting victims using digital services from home,” said Dimitrie Dorgan, senior document specialist at Onfido.
“Digitally native, the crypto market is a natural target. With the surge in Bitcoin price, some investors are becoming millionaires overnight, making crypto increasingly attractive for first-time fraudsters.
“It is critical that crypto trading platforms have strong customer identity and authentication techniques in place–allowing legitimate users to trade freely without fear of falling victim to bad actors or enabling fraudsters to impersonate genuine users.”
Further research, conducted by crypto intelligence firm CipherTrace, found that over half of the world’s cryptocurrency exchanges have weak or deficient customer identification and Know Your Customer (KYC) processes in place.
As crypto markets continue to rise in popularity among retail investors, robust KYC and anti-money laundering processes will be ever the more vital for trading and management platforms to effectively protect their users.