December 23, 2024

Combating Fraud in Crypto in 2025

51 minutes

When Tommy Nicholas (CEO of Alloy) wrote a blog titled, Your Fraud Model Is Broken, you had to know he and Ian Andrews (CMO, Chainalysis) were going to have a fun and insightful conversation.

This episode was originally published on December 5, 2023, where Tommy discussed how early NFTs and Bitcoin transaction speeds got him interested in the space and years later his company Alloy is now servicing Fintechs, Crypto and TradFi companies managing their compliance, AML, credit, and fraud risk.

He explains the broken fraud model and the need for a shift in approach to focus on the person rather than just the transaction. He emphasizes the importance of transparency and accountability by regulators in the industry and the burdensome requirements placed on the private sector.

To share insights since the episode was published last year, we added fresh commentary from Rich Scioli, Alloy's General Manager of Global Fintech. Rich brings us up to speed on the latest in fraud prevention, crypto security, and gives us the real story behind the rise and fall of embedded finance.

Minute-by-minute episode breakdown

(2:10) - Alloy's role in managing wide variety of risks for companies dealing with money

(5:08) - Alloy as an operating system for risk management instead of just another risk solution

(7:23) - The frustration behind the blog "Your Fraud Model is Broken"

(14:33) - The burden and costs of money laundering controls on the private sector

(18:27) - The inefficiency of processing suspicious activity reports

(19:50) - Updated: The State of Embedded Finance Report Key Takeaways

(22:56) - Threat actors taking advantage of online onboarding

(30:03) - How Alloy got into the crypto industry and fraudulent practices they have identified

(32:15) - Updated: The evolution of fraud going into 2025 and beyond

(33:13) - Involvement in the NFT community and the potential of digital collectibles

(36:45) - Updated: Cross border payments, stablecoins and everything in between

(42:00) - International look at fraud and compliance for the fintech / crypto industry

(47:00) - Updated: What to look out for from Alloy and the crypto industry

Related resources

Check out more resources provided by Chainalysis that perfectly complement this episode of the Public Key.

Website: Stop fraud, stay compliant, and solve your identity risk problem

Report: Alloy's Annual State of Compliance Benchmark Report 2023

Article: Your fraud model is broken

Blog: Banks have a friction challenge

Report: 2024 State of Embedded Finance Report

Report: The 2024 Crypto Maturity Journey: How Traditional Finance Can Adopt Cryptocurrency in Stages

Blog: Growth Opportunities: Stablecoins, TradFi Engagement, and Tokenization Lead Web3’s Next Wave

YouTube: Chainalysis YouTube page

Twitter: Chainalysis Twitter: Building trust in blockchain

Tik Tok: Building trust in #blockchains among people, businesses, and governments.

Telegram: Chainalysis on Telegram

Speakers on today’s episode

Ian Andrews * Host * (Chief Marketing Officer, Chainalysis)

Tommy Nicholas (CEO, Alloy)

Rich Scioli (General Manager of Global Fintech, Alloy)

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