Glossary
Daisy-chain inflation
Also called: long-horizon round-tripping
One-sentence definition
Daisy-chain inflation is the long-horizon version of circular transaction fraud, where money flows through three or more counterparties over weeks or months and returns to the merchant — evading short-window detectors that look for immediate symmetry.
Key takeaways
- The patient version of circular fraud.
- Designed to evade detectors that only look at narrow time windows.
- Net flow is small, gross flow is large — that ratio is the tell.
- Often spread across multiple counterparties to avoid triggering symmetry rules.
Why it matters for MCA underwriting
Sophisticated revenue inflation does not move money through the same counterparty within seven days. It uses multiple counterparties, spreads the cycles across weeks, and relies on the underwriter looking at each transaction in isolation.
When daisy-chain inflation is missed, the apparent revenue carries no real economic weight. The funder bases the underwriting on a number that nets out to nothing.
How Vyaso detects daisy-chain inflation
Vyaso analyzes each counterparty's full inflow and outflow across the statement period. Counterparties whose net flow is small relative to gross flow trigger the daisy-chain layer, particularly when several such counterparties are interconnected in a chain.