The Asia Pacific region has made remarkable strides in the fight against fraud, witnessing a substantial decline in fraudulent verification attempts, according to insight from verification platform Sumsub.
Sumsub’s latest State of Verification and Monitoring in the Crypto Industry 2023 report, provides insights into the crypto industry’s verification and monitoring practices. Sumsub conducted a survey among more than 100 crypto companies and combined its results with expert interviews of professionals in the crypto industry. While studying over 800,000 fraud attempts.
The study reveals that fraudulent verification attempts in Asia Pacific have dropped from 4.9 per cent in 2022 to 2.6 per cent in 2023. Singapore, in particular, stands out with a notable reduction in fraudulent activities during 2023.
In 2023, Singapore exhibited growth in average pass rates for the standard verification process, increasing from 82.8 per cent to 92.2 per cent – Hong Kong has the highest pass rates in 2023 with 96.6 per cent.
Hong Kong also ranks second in terms of the average time for the standard verification process in the crypto industry, at 35 seconds, following closely behind Germany. The highest conversation rates for proof of address (PoA) were achieved in Singapore (91.5 per cent), Slovakia (89 per cent), and Hong Kong (87.5 per cent).
The company’s report also shed light on the rising concern of deepfakes in the crypto sector, with 70 per cent of respondents acknowledging their increasing usage by fraudsters.
Seventy-seven per cent of crypto companies observed new fraud patterns and schemes this year, with attack methods becoming more professional.
In 2023, the number of deepfakes in the crypto industry increased by 128 per cent compared to 2022; while 55 per cent of crypto companies reported an increase in fraud-related losses – both financial and reputational – connected to applicants.
The shift from document-based to Non-Doc verification solutions is underway in crypto, demonstrating faster verification, from 38 to as fast as five seconds and from 46 to as quick as three seconds in Brazil and Ghana, respectively.
Jacob Sever, co-founder and chief innovation officer of Sumsub, comments: “From 2022 to 2023, verification time nearly halved across all regions, driven by the growing expectation of swifter processes among users. As such, providers face the challenge of complying with increasingly stringent regulations, making solutions such as Non-Doc Verification essential.
“By expediting onboarding processes, crypto firms eliminate the need for users to upload any documents, better allowing providers to keep pace with industry demands and enhance pass rates, all while thwarting the threat of synthetic fraud.”