Innovations in artificial intelligence never cease to amaze, but not all of them serve noble intentions. This October, cybersecurity company Cato Networks reveals an AI tool called ProKYCdesigned to bypass KYC (Know Your Customer) security measures in cryptocurrency exchanges. This tool opens the door to new forms of fraud, to the detriment of platforms and users. While this phenomenon remains difficult to detect, it could transform the way crypto exchanges approach security.
ProKYC: when AI creates virtual identities in a few clicks
The crypto market has always attracted cybercriminals. With millions at stake, it's no wonder that fraud tools are becoming more sophisticated.
ProKYC, presented by Cato Networks, embodies this new generation of fraudulent tools. Unlike traditional methods of purchasing fake documents on the dark web, ProKYC creates new identities autonomously. Using deepfake videos, this tool is able to produce images and videos that pass facial recognition checks on the largest crypto platforms, like Bybit.
The tool, specially adapted for crypto exchanges, offers a simple process. With just a few clicks, a user can generate a unique face, adjust details like fingerprints, and obtain documents like a virtual passport.
The ProKYC promotional video, released by Cato, shows how this tool assembles a fake identity using accompanying images and videos.
With disturbing precision, these deepfakes simulate human faces, realistic enough to fool the majority of current KYC checks.
Crypto security faces AI challenges
The impact of ProKYC goes way beyond cryptos. Indeed, this tool also claims to be able to bypass the KYC protocols of payment platforms like Stripe and Revolut.
With an annual subscription of approximately $629, ProKYC positions itself as an affordable service, a profitable investment for fraudsters seeking to multiply accounts under fictitious identities.
This phenomenon, known as New Account Fraud (NAF)has already caused significant losses for businesses.
Etay Maor, chief security strategist at Cato Networks, warns that this development is difficult to combat. Too many restrictions risk triggering false positives, penalizing legitimate users, while looser controls would let fraudsters through.
The sophisticated nature of ProKYC could require hybrid solutions, blending advanced biometric detection technologies and human monitoring to uncover inconsistencies that only a machine could not spot. Meanwhile, young people see a promising future in crypto.
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