Chinese internet giant Tencent is working with the government in its fight against cryptocurrency scams. The company has developed a financial monitoring tool that the government has been using to screen firms suspected of illegal cryptocurrency activity in the country.
The Chinese government has already used Tencent’s monitoring tool to screen 39 institutions suspected of being involved in crypto scams, a report by 8BTC revealed. Known as Linkgun, the tool uses artificial intelligence to analyze government data, social media and other types of open information for irregular crypto activity.
Linkgun has identified Shenzhen as the city with the highest number of crypto scams. Known as China’s tech city, Shenzhen was also identified as the city with the highest number of offices for overseas crypto companies, most of which are compliant.
Tencent’s involvement in the monitoring of crypto transactions has a lot to do with its extensive social media network. The Shenzhen-based company operates China’s most popular social media platform, WeChat which has over 1 billion users. It also owns QQ, the country’s most popular instant messaging platform. According to the report, most cryptocurrency activity in China takes place on social media platforms, making Tencent the ideal partner to the government as it seeks to crack down on crypto scams.
Linkgun fully exploits Tencent’s tech expertise, finally allowing the government to overcome the challenge of data and computing power shortage. It also uses AI, a field that Tencent has continued to invest in.
Apart from cryptocurrencies, Linkgun is also being used to identify risk index in over ten other financial categories including foreign exchange, P2P finance and more. And while Linkgun is the first tool Tencent has developed that monitors financial transactions, it has a history of releasing data collected from its customer base. In 2018, the company released data such as its users’ video calling habits, their sleep time, frequently used emoticons and more. The company has, however, sought to reassure its users that the data can’t be used to identify them personally.
Tencent has continued to invest in blockchain and cryptocurrencies, rivaling its fellow tech behemoth, Alibaba. Just recently, it revealed that it had been licensed to create a virtual bank by the Hong Kong Securities and Futures Commission. A few weeks ago, the company was also tasked with developing standards for blockchain invoicing.
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